LIC Recommends ₹10 Dividend Per Share for FY2025-26; Provides Detailed Guidance on TDS
The Board of Directors of Life Insurance Corporation of India (LIC) has recommended a final dividend of ₹ 10 per equity share, based on a face value of ₹10, for the financial year 2025-26. This recommendation was made during the meeting held on May 21, 2026.The dividend is subject to approval by the Members of the Corporation at the forthcoming 5th Annual General Meeting (AGM), scheduled for Monday, July 27, 2026.
Dividend Payment and Record Date
LIC announced that eligible members will receive the final dividend within 30 days from the date of its approval in the AGM. This means payments are expected on or before August 25, 2026.The Record Date for determining eligible members is set as Thursday, June 25, 2026. Shareholders must be listed in the Register of Members or Beneficial Owners of Depositories (NSDL and CDSL) by this date to receive the payout.
Tax Deduction at Source Explained
As per provisions governing dividend income, LIC is required to deduct Tax at Source (TDS) on all payments made. The applicable tax deduction rates depend on the residential status and classification of the entity receiving the dividend, which must be determined based on PAN details registered with relevant entities.The Corporation has provided specific guidance regarding TDS for various shareholder categories. A summary of the applicable TDS status for resident members is detailed below:
| Category of Members | Applicable TDS Rate | Required Documentation |
|---|---|---|
| Insurance Companies | NIL | Self-declaration qualifying as 'Insurer' and copy of PAN card and IRDAI registration certificate. |
| Alternative Investment Funds (AIF) | NIL | Self-declaration that income is exempt under Schedule V to Section 11 of the IT Act, 2025, along with SEBI registration details. |
| Mutual Funds | NIL | Self-declaration that it is registered with SEBI and compliant with requirements under Schedule VII to Section 11 of the IT Act, 2025. |
| National Pension System (NPS) Trusts | NIL | Self-declaration qualifying as NPS Trust along with self-attested PAN card copy. |
| Corporations established by Central Act | NIL | Self-attested documentary evidence supporting exemption along with PAN card copy. |
Tax Rules for Residents and Non-Residents
Resident Individuals:No tax will be deducted on the dividend if the resident individual’s total dividend received during Tax Year (TY) 2026-27 does not exceed ₹ . 10,000. Additionally, residents can claim zero TDS if they submit Form 121 and an Exemption certificate issued by the Income Tax Department.
Other Resident Members:
For non-individual resident entities (including insurance companies, AIFs, and mutual funds), no tax is deducted provided the member provides specific self-declarations and required supporting documents detailing their status.
Non-Resident Members:
The standard TDS rate for non-resident members is 20% (plus applicable surcharge and cess). Non-residents who wish to avail benefits under a Double Tax Avoidance Agreement (DTAA) must submit necessary documentation, including a Tax Residency Certificate (TRC), by June 24, 2026.
Key Operational Mandates for Members
The Corporation has mandated several operational requirements regarding dividend payments and tax compliance:- Payment Method: All dividend payments must be remitted exclusively through RBI-approved electronic modes; physical options such as demand drafts are discontinued.
- Compliance Deadline: Eligible members seeking a lower tax rate must submit the valid Lower Tax Certificate issued by Income Tax Authorities on or before June 24, 2026.
- TDS Credit: The Corporation requires the deductee (registered shareholder) to submit a formal signed Declaration under Rule 203 if the dividend income is assessable in the hands of another person (beneficial owner).
Shareholders are advised to register or update their bank and KYC details with the Depository Participants (DPs) or Kfin Technologies Limited (RTA), depending on whether their shares are held dematerialized or physically.
LICI Stock Price Movement
On Monday, Life Insurance Corporation Of India (LICI) shares edged higher, gaining 1.69% to close at ₹405.70 after the market session. The stock saw strong trading activity as it closed, with nearly 2.9 million shares changing hands during the day.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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