MAT exemption for SEZ unit

This query is : Resolved

Karthick (Querist)
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21 November 2016 Dear Sir/Mam. Our company has one unit in SEZ we paid MAT for 5 years..as per Sez scheme we can MAT will credit back to us..can any one explain how to utilise MAT..

Z (Expert)
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22 November 2016 MAT is payable when tax payable as per MAT provisions is more than normal Income tax provisions. If MAT is paid then the difference between the tax as per MAT provisions and normal provisions can be carried forward for 10 years.
If the tax payable as per normal provisions is more than tax payable as per MAT then, you can utilize the MAT credit to pay Income tax.
Utilization shall be in such a way that MAT amount is still payable, but difference between the MAT and normal tax would be allowable as MAT credit utilization (s.b.t. availlbility of amount of MAT credit)

"In any assessment year in which the regular income-tax exceeds the alternate minimum tax, the tax credit shall be allowed to be set off to the extent of the excess of regular income-tax over the alternate minimum tax and the balance of the tax credit, if any, shall be carried forward."