Deemed Dividend (Section 2(22)(e)) Analyzer Tool

This tool helps users check if a loan or advance from a closely held company (private company) to a shareholder or a concern triggers the “deemed dividend” provisions under Section 2(22)(e) of the Income Tax Act, 1961.

Deemed Dividend Analyzer (Sec 2(22)(e))

1. Is the company a closely held company (not a company in which public are substantially interested)? 2. Is the recipient a shareholder holding at least 10% of voting power (or a concern in which such shareholder has substantial interest)? 3. Is the payment a loan or advance (not in the ordinary course of business, i.e., not for money-lending business)? 4. Amount of loan/advance given (₹): 5. Accumulated profits (including reserves, excluding share capital) as on date of loan (₹):

Note: Section 2(22)(e) applies only to closely held companies. Exemptions apply for loans in the ordinary course of money-lending business, or to certain entities (e.g., lending to other companies, certain trusts). Always consult the latest law and a tax professional for complex cases.