M A T (MINIMUM ALTERNATIVE TAX)
This query is : Resolved
20 May 2008
IN OUR COMAPANY INCORPORATED UNDER STPI
IT IS LAIABLE TO PAY MIMIMUM ALTERNATIVE TAX
HOW TO COMPUTE MAT
IT IS LAIABLE TO PAY MIMIMUM ALTERNATIVE TAX
HOW TO COMPUTE MAT
20 May 2008
Please refer to section 115 JB
20 May 2008
YES STPI UNITS ARE LIABLE FOR MAT AS CAN BE SEEN IN DETAIL BELOW.
EXTENSION OF MINIMUM ALTERNATE TAX ('MAT') ON STP UNITS
Perceived as a major blow (and wrongly so, in our opinion), STP units availing of 100% tax exemption under Sections 10A/10B of the Income tax Act, will now be required to pay Minimum Alternate Tax @ 10% (for 2007-08) of their 'book profits', as prescribed. Before this proposed amendment, STP Units were allowed to deduct their profits arising from their export operations, from their book profits, for purposes of MAT under Section 115JB of the Income tax Act. In other words, export profits were exempt from the levy of MAT.
he Income tax Act clearly provides that the MAT paid by the STP Unit can be adjusted against its tax liability over the next five years. MAT paid for 2007-08 and 2008-09 can be adjusted against the tax liabilities for the future years (upto five years).
The effective MAT rate for STPs which are domestic companies would be 11.33%(basic rate of 10% + Surcharge@ 10% + Education Cess of 3%).
SOURCE:
http://www.bpoindia.org/columns/budget-2007.shtml.
RECENTLY TAX EXEMPTIONS UNDER SEC 10 A/B WERE EXTENDED BY ONE YEAR BY THE GOVT BEYOND 31 -03-09.
BOOK PROFITS FOR MAT PURPOSE ARE ARRIVED AT AFTER MAKING 13 ADJUSTMENTS TO NET PROFITS..PL SEE SEC 115JB FOR DETAILED CALCULATIONS.
R.V.RAO
EXTENSION OF MINIMUM ALTERNATE TAX ('MAT') ON STP UNITS
Perceived as a major blow (and wrongly so, in our opinion), STP units availing of 100% tax exemption under Sections 10A/10B of the Income tax Act, will now be required to pay Minimum Alternate Tax @ 10% (for 2007-08) of their 'book profits', as prescribed. Before this proposed amendment, STP Units were allowed to deduct their profits arising from their export operations, from their book profits, for purposes of MAT under Section 115JB of the Income tax Act. In other words, export profits were exempt from the levy of MAT.
he Income tax Act clearly provides that the MAT paid by the STP Unit can be adjusted against its tax liability over the next five years. MAT paid for 2007-08 and 2008-09 can be adjusted against the tax liabilities for the future years (upto five years).
The effective MAT rate for STPs which are domestic companies would be 11.33%(basic rate of 10% + Surcharge@ 10% + Education Cess of 3%).
SOURCE:
http://www.bpoindia.org/columns/budget-2007.shtml.
RECENTLY TAX EXEMPTIONS UNDER SEC 10 A/B WERE EXTENDED BY ONE YEAR BY THE GOVT BEYOND 31 -03-09.
BOOK PROFITS FOR MAT PURPOSE ARE ARRIVED AT AFTER MAKING 13 ADJUSTMENTS TO NET PROFITS..PL SEE SEC 115JB FOR DETAILED CALCULATIONS.
R.V.RAO
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Manual Rectification through AO
- IT Return filed defective u/s 139 (9)
- Defective Return - Tds on advance
- Fixed Deposit Claim Relinquishment by the Nominee
- TCS ON SOFTWARE SALES
- Income Type for interest from government bonds
- TDS RATE ON RENT PAID TO NRI
- Not a CA , can we prepare balance sheet
- Tax treatment of debt mutual funds
- SHARE TRANSFER PRIVATE LIMITED COMPANY
- Issue of gst e invoice
- Gstr 9 2023-24
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
- 133(6) DIN INVALID format error - ->WHERE TO REPLY 133(6) notice?
- Query for dubts
- GST RCM not shown in GSTR-3B
- Bill from Dispatched from issue.
Trending Online Classes
-
Landmark Judgments: Important Provisions of the EPF & ESI Act interpreted by the Honorable Supreme Court of India
Mr.Balamurugan Ranganathan15 November 2024
CAclubindia
