MPR Sanjay Kumar (3118 Points)
25 March 2023
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177840 Points)
Replied 25 March 2023
1. Yes.
2. No net tax liability after rebate.
3. Not applicable in your case.
MPR Sanjay Kumar
(3118 Points)
Replied 25 March 2023
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177840 Points)
Replied 25 March 2023
The objective of introduction of MAT is to bring into the tax net "zero tax companies" which in spite of having earned substantial book profits and having paid handsome dividends, do not pay any tax due to various tax concessions and incentives provided under the Income-tax Law.
Since the introduction of MAT, several changes have been introduced in the provisions of MAT and today it is levied on companies as per the provisions of section 115JB.
As per the concept of MAT, the tax liability of a company will be higher of the following:
Tax liability of the company computed as per the normal provisions of the Income-tax Law, i.e., tax computed on the taxable income of the company by applying the tax rate applicable to the company. Tax computed in above manner can be termed as normal tax liability.
Tax computed @ 15% (plus surcharge and cess as applicable) on book profit (manner of computation of book profit is discussed in later part). The tax computed by applying 15% (plus surcharge and cess as applicable) on book profit is called MAT.
As per section 115JB, every taxpayer being a company is liable to pay MAT, if the Income-
tax(including surcharge and cess) payable on the total income, computed as per the provisions of the Income-tax Act in respect of any year is less than 15% of its book-profit + surcharge (SC) + health & education cess.
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177840 Points)
Replied 25 March 2023
MAT applies to companies and AMT applies to a person other than a company. The provisions relating to AMT are given in sections 115JC to 115JF
The provisions of AMT will apply to every non-corporate taxpayer who has claimed (i) deduction under section 80H to 80RRB (except 80P), (ii) deduction under section 35AD and (iii) deduction under section 10AA. Thus, the provisions of AMT are not applicable to a non- corporate taxpayer who has not claimed any deduction under above discussed sections. However, following points should be kept in mind in this regard.
The provisions of AMT shall apply to an individual or a Hindu undivided family or an association of persons or a body of individuals (whether incorporated or not) or an artificial juridical person only if the adjusted total income (discussed later) of such person exceeds Rs. 20,00,000.(Section 115JEE)
The provisions of AMT shall apply to every other person (i.e., other than an individual or a HUF or an AOP/BOI or an artificial juridical person) irrespective of its income. For definition of a person refer to section 2(31).
Further the provisions of AMT are not applicable to a person who has exercised the concessional tax regime available under section 115BAC or section 11BAD.
In case of non-corporate taxpayer, AMT is levied @ 18.5%* of adjusted total income (discussed later). Surcharge and cess as applicable will also be levied. However, AMT is levied 9% in case of a non-corporate assessee being a unit located in International Financial Services Centre and deriving its income solely in convertible foreign exchange. Surcharge and cess as applicable will also be levied.
MPR Sanjay Kumar
(3118 Points)
Replied 25 March 2023
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177840 Points)
Replied 25 March 2023
For contra entries, second one is right option, suggesting receipt by cash.
MPR Sanjay Kumar
(3118 Points)
Replied 25 March 2023
Dhirajlal Rambhia
(SEO Sai Gr. Hosp.)
(177840 Points)
Replied 25 March 2023
Actual reason is Cash is just one ledger/account, while bank accounts can be more than one, so it helps to add different bank account/s against single cash transaction be it withdrawal of deposit of cash, under double entry format.
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