Archive · 2 Oct 2026
Tax Rules Clarified for Dividends, Equity Gains and Home Loans
Dividend income is added to your other income and taxed using your normal tax rate.
Senior citizens do not get a separate tax-free amount just for dividends.
However, the general basic exemption limit may mean that no tax is payable.
The limit is Rs 4 lakh under the new tax regime and Rs 3 lakh under the old regime.
The new regime may also provide a rebate when total income is no more than Rs 12 lakh, if the rules are met.
You can sell eligible investments and book up to Rs 1.25 lakh in long-term gains in a financial year without tax on those gains.
Different types of investment losses can be used against different types of gains and may be carried forward.
For a joint home loan, both owners may claim interest deductions only when their ownership and repayment shares can be identified.
Dividend income is taxed at the investor’s applicable slab rate, with no separate tax-free dividend threshold for senior citizens.
The basic exemption limit is Rs 4 lakh under the new regime and Rs 3 lakh under the old regime; a new-regime rebate may apply up to Rs 12 lakh of total income, subject to conditions.
Long-term capital gains on listed equity and equity-oriented mutual funds are exempt up to Rs 1.25 lakh per financial year.
Long-term capital losses can offset only long-term gains, while short-term capital losses can offset both short- and long-term gains; unused losses may be carried forward for eight years if the relevant ITR is filed on time.
Joint home-loan borrowers may each claim up to Rs 2 lakh of qualifying interest based on ownership and repayment shares, but this deduction is unavailable under the new regime.
- Who
- Senior citizens, equity investors, and joint home-loan borrowers.
- What
- The guidance explains tax treatment for dividends, equity gains and losses, and home-loan interest.
- When
- For the relevant financial year; the equity-gain exemption applies per financial year.
- Why
- To clarify applicable tax limits, loss set-off rules, and eligibility for deductions.
- Dividend taxation
- Taxed at the investor’s applicable slab rate; there is no separate dividend exemption for senior citizens.
- New-regime basic exemption
- Rs 4 lakh, including dividend income in total income.
- Old-regime basic exemption
- Rs 3 lakh, including dividend income in total income.
- New-regime rebate
- Section 156 rebate may provide relief when total income does not exceed Rs 12 lakh, subject to conditions.
- Equity LTCG exemption
- Long-term gains on listed equity shares and equity-oriented mutual funds are exempt up to Rs 1.25 lakh per financial year.
- Capital-loss carry-forward
- Unabsorbed capital losses may be carried forward for up to eight consecutive years if the relevant ITR is filed by the prescribed due date.
- Joint-home-loan interest
- Each eligible taxpayer may claim up to Rs 2 lakh based on ownership and repayment shares; the deduction is unavailable under the new regime.