Deemed Dividend Checker — Section 2(22)(e)

Does your company loan or advance to a shareholder trigger deemed dividend?

Applies to: FY 2025-26 (AY 2026-27) · Last reviewed: 2026-08-05 · Sources cited in tool footer

Inputs

Company is closely-held (private limited or unlisted public where ≥50% shares held by ≤7 persons)

Shareholder's equity voting power (%)

Alternatively: interest in a concern where the 10%+ shareholder has interest (%) — enter 0 if not applicable

Loan/advance amount (₹)

Company's accumulated profits at date of loan (₹)

Does an exception apply?

How it works

Check if the company is closely-held under the s.2(18) test.
Check whether the shareholder holds at least 10% voting power or a concern holds at least 20% interest.
Cap the loan or advance at accumulated profits.
Apply the ordinary-lending or bona fide trade-advance exception.

FAQs

What is deemed dividend?

Use the configured s.2(22)(e) logic and have the final position confirmed by your CA.

Why does the 10% threshold matter?

Use the configured s.2(22)(e) logic and have the final position confirmed by your CA.

How do accumulated profits cap the amount?

Use the configured s.2(22)(e) logic and have the final position confirmed by your CA.

Which exceptions can apply?

Use the configured s.2(22)(e) logic and have the final position confirmed by your CA.

Is TDS required on deemed dividend?

Use the configured s.2(22)(e) logic and have the final position confirmed by your CA.