HELLO, IWANT TO KNOW ABUT MINIMUM ALTERNATE TAX(MAT) ,&HOW IT WILL BE CALCULATED & WHEN.
3 Replies
Ashish M
(Chartered Accountant)
(2731 Points)
Replied 21 August 2009
MAT is the minimum tax which every company has to pay regardless of its own profits......
Every yr, while preparing the tax return, the tax is calculated on the income based on the profit of P&L A/c...and simulteneoulsly, Minimum alternate tax is also calculated....If the tax comes as per the profit and loss account, is less then the minimum tax (MAT), then MAT shall be paid as the tax and not the former.......
The profit & loss account is based on hte provisions of the income tax act other than XII-B (MAT). And simulteneould the income is find out according to Chapter XII-B.... Any difference of the Actual tax paid under MAT and the tax coming out to be under the normal provisions of income tax act can be carried forward in future yrs. and can be reduced from the tax in future yrs. when such tax woould be coming out to be more than MAT...............for 7 yrs...
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