Capital Small Finance Bank has outlined the tax deduction at source (TDS) and withholding tax rates applicable to the final dividend recommended for FY26. The Board of Directors recommended a dividend of ₹5 per equity share on April 29, 2026, subject to shareholder approval at the upcoming Annual General Meeting. The bank informed shareholders that tax will be deducted at the time of payment in accordance with the Income-Tax Act, 2025, with rates varying based on residential status and documentation submitted.

For resident shareholders, the bank specified that no tax will be deducted if the total dividend during Tax Year 2026-27 does not exceed ₹10,000. For those exceeding this threshold, the TDS rate is set at 10% if a valid PAN is updated with the depository or Registrar and Transfer Agent (RTA). If the PAN is invalid or not available, the tax rate increases to 20%. Shareholders can avail of a lower or nil rate by providing a valid certificate from the Income Tax Department under Section 395(1) of the Act.

Non-resident shareholders face different withholding tax structures. Foreign Institutional Investors (FIIs) and Foreign Portfolio Investors (FPIs) are subject to a 20% tax rate, plus surcharge and cess, or the beneficial tax treaty rate, whichever is lower. Alternative Investment Funds – Category III located in International Financial Services Centre will face a 10% rate plus applicable levies. Non-resident shareholders from Notified Jurisdictional Areas will be taxed at 30%, while Sovereign Wealth funds and Pension funds notified by the Central Government are exempt from withholding tax.

The bank has set a deadline of June 15, 2026, for shareholders to submit necessary documents such as Form 121, Tax Residency Certificates, and self-declarations to determine the appropriate withholding tax rate. Documents received after this date will not be considered. The bank reserves the right to verify PAN details independently and will apply higher tax rates if documents are found incomplete or discrepancies are identified. Shareholders are advised to update their KYC details with the RTA, MUFG Intime India Private Limited, to ensure seamless communication and dividend payment.

Resident Shareholder Tax Rates

Non-Resident Shareholder Tax Rates

Capital Small Finance Bank Limited has reported a Profit After Tax (PAT) of ₹141.39 crores for the financial year ended March 31, 2026, reflecting a compound annual growth rate (CAGR) of 26%. The bank’s gross advances increased to ₹8,687 crores, registering a growth of 21% year-on-year, while total deposits crossed ₹10,000 crores to reach ₹10,018 crores, a 20% annual increase.

The bank maintained a stable asset quality with Gross Non-Performing Assets (GNPA) at 2.54% and Net NPAs at 1.24% as of March 31, 2026. The Capital Adequacy Ratio (CAR) stood at 22.31%, well above the regulatory requirement of 15%. The Net Interest Margin (NIM) moderated to 4.04% for the year.

Financial Highlights

The board has recommended a final dividend of ₹5 per equity share of ₹10 each for FY26, subject to shareholder approval at the 27th Annual General Meeting scheduled for June 25, 2026.