Following an agreement between the Central Government and the State Governments, the rate of Central Sales Tax was reduced from 4 per cent to 3 per cent in this financial year. It is now proposed to reduce the rate to 2 per cent from April 1, 2008. Consultations are underway on the compensation for losses, if any, and once agreement is reached the new rate will be notified. I am also happy to report that there is considerable progress in preparing a roadmap for introducing the Goods and Services Tax with effect from April 1, 2010.
Compliance Calendar under Direct Tax Laws. Compliance Calendar under Indirect/Corporate & Labour Laws. Payment of monthly dues of Provident Fund. Monthly return in Form 5 for employees joining Provident Fund during previous month along with declaration in Form 2 furnished by the employees. Monthly return of PF in Form 10 of employees leaving the service during preceding month. Quarterly Corporate Governance Compliance Certificate by listed companies to stock exchanges under clause 49(VI)(ii) of Listing Agreement
No need to report if transaction is not speculative. Companies may get to avoid reporting losses on derivative contracts provided they can prove that the transaction was a hedge and not speculative in nature. A recent clarification by the Institute of Chartered Accountants of India (ICAI) regarding disclosure norms for derivative contracts had specified that companies would have to disclose mark-to-market losses from such transactions, financial year 2007-08 onwards. Sources now say companies have the leeway to avoid reporting losses on derivative contracts, as there are enough mechanisms in accounting standards that lay out the guiding principles in this regard.
Even as the limited liability partnership (LLP) law is soon to become a reality, the issue of tax treatment for such entities has not yet been finalised. The Ministry for Corporate Affairs (MCA) has left it to the Finance Ministry to take a final call on the contentious issue of tax treatment for LLP firms.
The Income Tax department had on 26.3.2008 advised all tax deductors to invariably quote PAN in their TDS returns in all cases wherein they have deducted tax and deposited it into the government account. This has been emphasized as non-quoting of PAN results in inability to give credit to the deductees while processing their cases.
There appears to be uncertainty over the implementation of the Commodity Transaction Tax from April 1 with broking firms saying the exchanges have not notified them on the issue till late Monday evening. The Finance Minister, Mr P. Chidambaram, had announced in his Budget proposal that the levy would come into effect from April 1. Mr B.C. Khatua, Chairman, Forward Markets Commission, said Unlike the income tax, which comes into force from April 1, the commodity levy will be charged only when the Finance Bill is cleared by Parliament.
Changes in MVAT RETURN FILING – TL in Previous Year TR in previous Year Periodicity Form & Due Date Tax Liability (TL) Tax Refund (TR) 1) upto Rs. 1 lakh upto Rs. 10 Lacs Half Yearly 231/21 days 2) upto Rs. 10 lacs upto Rs. 1 crore Quarterly 231/21 days 3) More than 10 Lacs More Than Rs. 1 Crore Monthly 231/21 days
Small-and medium-sized companies (SMCs) may soon have a `SARAL’ format for disclosing their financial statements. For ensuring better compliance by all categories of companies with disclosure norms prescribed under the company law, the Ministry for Corporate Affairs (MCA) had asked the Institute of Chartered Accountants of India (ICAI) to suggest a simpler format of financial statements especially for SMCs.
Government has issued Notification No. 17/2008-ST dated 1-4-2008, extending refund of service tax paid by exporters on three more taxable services in addition to existing 13 taxable services, which are not in the nature of “input services” but could be related to exports. · Custom House Agent service [section 65(105)(h) of the Finance Act, 1994], · Banking and other financial services [section 65(105)(zm)] in relation to collection of export bills and export letters of credit, Commission agent service under business auxiliary service [section 65(105)(zzb) ] provided by a commission agent, located outside India subject to the conditions prescribed.
In order to provide more opportunities to eligible audit firms, the existing cycle of four years of continuous statutory central audit in PSBs with compulsory rest of two years will be reduced with prospective effect to a cycle of three years of continuous statutory central audit with compulsory rest of two years. This will be effective from 2006-07 in respect of SCAs appointed in 2006-07 and onwards. The existing continuing auditors will be allowed to complete their four years’ cycle after which they will be rested for a period of two years. The appointment of SCAs will be made on an annual basis, subject to their fulfilling the eligibility norms prescribed by RBI from time to time and also subject to their suitability.
