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Is mat payable can set off against tds

navinkumar naicker (Article) (419 Points)

26 September 2012

Hello CAclubindia,

can u people please let me know whether MAT payable can be set off againts the TDS credit available as per 26AS statement or advance tax paid.

thank u

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20 Replies

CA.Ankur Khandelwal (Owner) (281 Points)
Replied 26 September 2012

sorry..............yes it can b adjsted

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CA Pooja Agarwal (Chartered Accountant) (3228 Points)
Replied 26 September 2012

@ ankur..can you please explain why?

1 Like

Jaiveer Singh Rawat (Learner) (130 Points)
Replied 26 September 2012

Hi Navin,

Yes , MAT can be set off against the credit available in 26AS.....First you need to do the calculation of MAT than set off with the 26AS credit......

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navinkumar naicker (Article) (419 Points)
Replied 26 September 2012

@ pooja

hi if you any other answer can you pls put forward & then decide on it.

Jaiveer Singh Rawat (Learner) (130 Points)
Replied 26 September 2012

@ Ankur

Hi dear....can you please explain why the MAT can't be set off against 26AS credit ?

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navinkumar naicker (Article) (419 Points)
Replied 26 September 2012

Hi jaiveer many thanks for your answer

can u pls convey your answer with reference to the section of income tax act.

CA Pooja Agarwal (Chartered Accountant) (3228 Points)
Replied 26 September 2012

i also think it can be set off..if its not allowed to set off.it would lad to excess levy of tax

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Jaiveer Singh Rawat (Learner) (130 Points)
Replied 26 September 2012

Hi Navin

Need to find it out but as you have the tax credit of 26AS the same can be seen as tax paid in advance. According to this you can set off your MAT against this. Further i will find out the exact section & will post the same here.......

Do allow me some time for the same.

1 Like

CA Harsh Lunia (Audit) (81 Points)
Replied 26 September 2012

If tax computed as per MAT is more thanthe tax computed under other provisions of Income tax, then, tax computed under MAT is what is to be remitted to the Government. Now since tax calcuted under MAt becomes our income tax liability, it can be adjusted against advance tax paid or TDS receivable and the balance can be paid under self assessment.

(Ankur, please correct me if I am wrong)

4 Like

CA Raman Kumar (job) (132 Points)
Replied 26 September 2012

DEAR

MAT LIABILITY ARISE WHEN TAX CALCULATED ON NORMAL PROFIT IS LOWER THAN TAX CALCULATE -D ON BOOK PROFIT . IT MEANS MAT IS OUR LIABILITY HENCE TDS SHOWN IN 26AS ARE LIABLE FOR SET OFF PURPOSE.

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anik dey (job) (50 Points)
Replied 26 September 2012

See Sec 115JB(5)

C.A SUVAJIT SAHU (CA ( In Practice )) (708 Points)
Replied 26 September 2012

hi NAVIN.......

MAT represents income tax and TDS also represents income tax ...........

section 115JB(5) specifically allows all other provisions of income tax act for the purpose of MAT.

hence , TDS credits is eligible for set off against MAT tax .

CA Ayush Agarwal (Kolkata-Pune-Mumbai) (27186 Points)
Replied 27 September 2012

Dear All,

Yes, It Can Be Adjusted.

Since The MAT 115JB & IT Are All Governed by One & Single Act, Income Tax act.

See the Logic:

If Say You Dont Adjust, The You Will Ask for 26AS Credit i.e TDS Refundable.

Ultimate Result is One & Same.

1 Like

HARI KRISHNA (B.COM ACA CMA) (412 Points)
Replied 27 September 2012

MAT CREDIT CANNOT BE USED TO SET OFF WITH 26AS. IT CAN BE USED ONLY WHEN TAX PAYABLE AS PER INCOME TAX ACT IS MORE THAN TAX PAYABLE AS PER BOOK PROFIT.