A Pvt Ltd. which has about Rs.75000 of business loss carried forward from the past 2 years made a profit of about Rs.35000 in the year ended 31/3/12. Now, can this profit be set-off against this loss? What about MAT provisions? Will the Company have to pay any tax(MAT) even though the profit this year is less than the loss carried fwd till date?
14 July 2012
Yes the Income tax loss of Rs. 75000 can be set off against the business profit of the current year.If book profit is greater then tax payable under IT then you have to pay MAT.While computing book profit the amount of loss b/f or unabsorbed depreciation whichever is less as per books of account can be reduced from the net profit.
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