Minimum Alternate Tax

Payment of tax by certain companies U/s. 115JB- CAG Report

Income Tax - Several companies that were having large profit from business and distributing substantial portion of the income to their shareholders as dividend, were reducing their tax liability by availing various deductions and exemptions available in the Act. ...

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Accounting of convertible instruments under Ind-AS and its MAT impact

Income Tax - The year ending 31 March, 2017, witnessed many companies preparing their financial statements as per the Indian Accounting Standards (‘Ind-AS’) for the first time. Ind-AS is a set of accounting standards that converge with the International Financial Reporting Standards (‘IFRS’) and require companies to adopt fair value accounting...

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MAT impact on financials under IND AS

Income Tax - 1. Background With companies having net worth exceeding INR 500 crores required to converge their financials with the Indian Accounting Standards (IND AS) for financial years beginning on or after 1 April, 2016, the Minimum Alternate Tax (MAT) implications for section 115JB of the Income Tax Act, 1961 (ITA) were a big mystery. The Finance...

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AMT Provisions under Income Tax Act 1961( AY 2017-18)

Income Tax - As per section 115JC of Income Tax Act , 1961 , AMT is Alternate Minimum Tax computed on the adjusted total income of a non corporate assessee....

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Remove proposed restriction on carry forward of MAT/ AMT credit: ICAI

Income Tax - Section 115JAA(2A) - Restriction on carry forward of MAT/AMT credit and claim of FTC in relation to taxes under dispute - Restriction to be removed...

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Relevant part of recommendations of MAT-Ind AS Committee’s Report

Income Tax - Relevant part of MAT-Ind AS Committee Report dated 17th June, 2017 containing recommendations regarding amendment to the provisions of the section 115JB of the Income-tax Act, 1961 in respect of Ind AS Compliant Companies....

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ASSOCHAM advocates MAT exemption for sick companies under debt restructuring

Income Tax - Apex Industry body ASSOCHAM has advocated continuation of the exemption from MAT (Minimum Alternative Tax) by the insertion of a suitable substitution of or addition to the Income Tax Act in respect of the restructuring under the insolvency & banking code 2016....

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Framework for computation of book profit for MAT levy on Ind AS compliant companies

Income Tax - On the basis of the recommendations of the Committee on MAT-Ind AS, the Central Government has notified 10 ICDS vide Notification No. S.O.892(E) dated 31st March, 2015. With the approval of the Finance Minister , the above said Committee was also requested to suggest the framework for computation of book profit for the purposes of levy of...

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MAT may be made inapplicable to foreign Cos having no PE in India from 1st April, 2001

Income Tax - Government Decides to Amend Income-Tax Act 1961 so that with Effect from 1st April, 2001, the Provisions of Section 115JB Shall Not be Applicable to a Foreign Company If the Foreign Company is a Resident of a Country Having DTAA with India and Such Foreign Company Does Not have a Permanent Establishment within the Definition of the Term i...

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CBDT advises not to Pursue Recovery of Outstanding Demands in MAT cases of FIIS/FPIS

Income Tax - Instruction No. 9/2015 Following the Acceptance of the Recommendation of the Justice A.P.Shah Committee by the Government, CBDT Advises its Field Authorities to keep in Abeyance, for the Time being, the Pending Assessment Proceedings in Cases of FIIS/FPIS Involving the Applicability of Minimum Alternate Tax (MAT) on FIIS/FPIS for the Peri...

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Treatment of bad debts for computation of book profit u/s 115JA/JB

CIT Vs Vodafone Essar Gujarat Ltd (Gujarat High Court) - Brief facts leading to the reference are as under. The respondent assessee is a company registered under the Companies Act. For the assessment year 2003­2004, the assessee had filed return of income declaring nil income. The Assessing Officer framed the order of assessment on 27.03.2006...

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Retention money cannot be treated as Income till performance of contractual obligations

D.C.I.T. VS. M/s. McNally Bharat Engineering Co.Ltd.(ITAT Kolkata) - Retention money is not in the nature of income till such time the contractual obligations are fully performed to the satisfaction of the customer by the Assessee. Therefore the retention money cannot be regarded as income even for the purpose of book profits u/s.115JB of the Act though credited in t...

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MAT not payable on Capital receipts on forfeiture of share warrants

DCIT Vs M/s. Binani Industries Ltd. (ITAT Kolkata) - ITAT held that it is not in dispute that the receipt representing forfeiture of share warrants is only a capital receipt & not chargeable to tax. However, the same has been duly credited in the profit and loss account as an extraordinary item....

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MAT credit to be calculated after surcharge and Cess

M/s Virtusa (India) Pvt. Ltd. Vs DCIT (ITAT Hyderabad) - As per sec.115JB (2A), the tax credit shall be the difference of tax paid for any AY under 115JB(1) and the amount of tax payable on his total income computed in accordance with the other provisions of this Act....

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Whenever order of Re-assessment is passed, Period of Limitation will start from the date of Re-assessment order and not from Original Assessment order

Rastriya Ispat Nigam Limited Vs Asst. Commissioner of Income Tax (Telangana and Andhra Pradesh High Court) - Rastriya Ispat Nigam Limited v. ACIT In this case the writ petition was filed by the Assessee in which the AP High Court while dismissing the writ petition held that whenever an order is made under the re-assessment...

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CBDT notifies revised Form no. 29B for MAT audit with Annexures

Notification No. 80/2017-Income Tax/ G.S.R. 1028(E) - (18/08/2017) - Details of the amount required to be increased or decreased in accordance with sub-section (2A) of section 115JB- [Applicable only where the financial statements of the company are drawn up in compliance with the Indian Accounting Standards specified in Annexure to the Companies (Indian Accounting S...

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FAQs on computation of book profit to levy MAT for Ind AS companies

Circular Number 24/2017-Income Tax - (25/07/2017) - Clarifications with FAQs on computation of book profit for the purposes of levy of Minimum Alternate Tax (MAT) under section 115JB of the Income-tax Act, 1961 for Indian Accounting Standards (Ind AS) compliant companies....

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Issues on implementation of MAT provisions for Ind AS companies

NA - (25/07/2017) - CBDT press release on Issues arising from the implementation of Minimum Alternate Tax (MAT) provisions relating to Indian Accounting Standards (Ind AS) compliant companies....

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Modification in Circular related to Tax Effect for Appeal Filing

F.No.279/Misc./M-142/2007-ITJ(Pt.) - (14/07/2017) - References are being received by the Board that in certain cases appellate authorities are dismissing appeals without going into the merits of the case by relying on the definition of `tax effect' as defined in Circular No. 21/2015, which prescribes the monetary limit for filing appeals before vario...

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Reg. Penalty in cases where despite addition tax payable under MAT Provisions is higher than under Normal Provisions

Circular No. 25/2015 - Income Tax - (31/12/2015) - CIRCULAR NO. 25/2015 Penalty u/s 271(1)(c) wherein additions/disallowances made under normal provisions of the Income Tax Act, 1961 but tax levied under MAT provisions u/s 115JB/115JC, for cases prior to A.Y. 2016-17-reg.- Section 115JB of the Act is a special provision for levy of Minimum Alternate...

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Recent Posts in "Minimum Alternate Tax"

CBDT notifies revised Form no. 29B for MAT audit with Annexures

Notification No. 80/2017-Income Tax/ G.S.R. 1028(E) (18/08/2017)

Details of the amount required to be increased or decreased in accordance with sub-section (2A) of section 115JB- [Applicable only where the financial statements of the company are drawn up in compliance with the Indian Accounting Standards specified in Annexure to the Companies (Indian Accounting Standards) Rules, 2015 for the previous y...

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Treatment of bad debts for computation of book profit u/s 115JA/JB

CIT Vs Vodafone Essar Gujarat Ltd (Gujarat High Court)

Brief facts leading to the reference are as under. The respondent assessee is a company registered under the Companies Act. For the assessment year 2003­2004, the assessee had filed return of income declaring nil income. The Assessing Officer framed the order of assessment on 27.03.2006...

Read More

Payment of tax by certain companies U/s. 115JB- CAG Report

Several companies that were having large profit from business and distributing substantial portion of the income to their shareholders as dividend, were reducing their tax liability by availing various deductions and exemptions available in the Act. ...

Read More
Posted Under: Income Tax |

MAT (Minimum Alternate Tax) Provisions in Just 4 Pages

I am sharing MAT Summary of just 4 pages covering almost all the provisions relating to MAT (Minimum Alternate Tax). This Summary is relevant to A.Y. 2017-18 and include amendments made by Finance Act 2016....

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Posted Under: Income Tax |

Relevant part of recommendations of MAT-Ind AS Committee’s Report

Relevant part of MAT-Ind AS Committee Report dated 17th June, 2017 containing recommendations regarding amendment to the provisions of the section 115JB of the Income-tax Act, 1961 in respect of Ind AS Compliant Companies....

Read More
Posted Under: Income Tax |

FAQs on computation of book profit to levy MAT for Ind AS companies

Circular Number 24/2017-Income Tax (25/07/2017)

Clarifications with FAQs on computation of book profit for the purposes of levy of Minimum Alternate Tax (MAT) under section 115JB of the Income-tax Act, 1961 for Indian Accounting Standards (Ind AS) compliant companies....

Read More

Issues on implementation of MAT provisions for Ind AS companies

NA (25/07/2017)

CBDT press release on Issues arising from the implementation of Minimum Alternate Tax (MAT) provisions relating to Indian Accounting Standards (Ind AS) compliant companies....

Read More

Modification in Circular related to Tax Effect for Appeal Filing

F.No.279/Misc./M-142/2007-ITJ(Pt.) (14/07/2017)

References are being received by the Board that in certain cases appellate authorities are dismissing appeals without going into the merits of the case by relying on the definition of `tax effect' as defined in Circular No. 21/2015, which prescribes the monetary limit for filing appeals before various appellate authorities....

Read More

Accounting of convertible instruments under Ind-AS and its MAT impact

The year ending 31 March, 2017, witnessed many companies preparing their financial statements as per the Indian Accounting Standards (‘Ind-AS’) for the first time. Ind-AS is a set of accounting standards that converge with the International Financial Reporting Standards (‘IFRS’) and require companies to adopt fair value accounting...

Read More
Posted Under: Income Tax |

MAT impact on financials under IND AS

1. Background With companies having net worth exceeding INR 500 crores required to converge their financials with the Indian Accounting Standards (IND AS) for financial years beginning on or after 1 April, 2016, the Minimum Alternate Tax (MAT) implications for section 115JB of the Income Tax Act, 1961 (ITA) were a big mystery. The Finance...

Read More
Posted Under: Income Tax |
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