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Taxation Central Ministry of Finance Income-Tax Act, 2025

CBDT Issues Notification Regarding Exemption from TDS on Dividend Payments Between Eligible Aircraft Leasing Units in IFSCs

04-Nov-2026 | Notification No. 141/2026

CBDT has issued Notification Regarding Exemption from TDS on Dividend Payments Between Eligible Aircraft Leasing Units in IFSCs with effect from 1st April 2026 Through this notification, CBDT has provided that no TDS shall be deducted under Section 393(1) [Table: Sl. No. 7] of the Income-tax Act, 2025 on dividend income paid by an IFSC unit primarily engaged in aircraft leasing to another company which is also an IFSC unit primarily engaged in aircraft leasing. Further, the exemption shall be available subject to the payee furnishing a duly verified statement-cum-declaration in Form No. 1(N) specifying the relevant tax year and confirming its eligibility for exemption under Schedule VI of the Income-tax Act, 2025. The payer shall not deduct TDS on dividend payments made or credited after receiving the prescribed declaration from the payee. The payer shall also be required to report all such dividend payments on which tax has not been deducted in the applicable TDS statement under Section 397(3)(b) read with Rule 219 of the Income-tax Rules, 2026. Form No. 1(N) requires the payee to furnish details including its name, PAN, IFSC unit particulars, contact information and relevant tax year along with declarations confirming that it continues to undertake aircraft leasing activities and fulfils the prescribed conditions for claiming the exemption. For more information kindly refer the attached document

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