Applicability of alternate minimum tax

If declared now, Emergency will fail because of technology: With the 68 notices sent to FIIs for their past capital gains up to March 31 creating a huge uproar, the government has been trying to soothe the foreign institutional investors, who turned net sellers for the first time since April Sameer Gupta, tax leader for financial services, EY India, said that the finance minister has expanded the base for MAT carve out from FPIs to foreign companies earning the specified income streams.

Applicability of alternate minimum tax

Applicability of alternate minimum tax

Later on by the FA this has been extended to all assesses other than companies. For companies we find separate provisions for MAT. The effective deductions shall also have limited effective life and they will be phased out or become ineffective gradually over some years.

The effective sections under which claims against certain incomes will be available for AY and which will be hit by provisions of AMT are as follows: Section 80 IB- certain industrial undertakings and enterprises.

Section IC- undertakings in certain special category states.

Applicability of alternate minimum tax

Section ID- hotel and convention centers in specified area. Section 80JJA- collection and processing of bio degradable waste. Section 80JJAA- employment of new workman. Section 80LA — offshore banking units and international financial service center. Section 80 QQB- certain royalty to authors of books.

Section 80RRB — Royalty on patents. Option in hands of assessee: If an assessee does not want to fall under provisions of AMT, he can avoid the same by not preferring claims under specified sections.

In the following table, in left column provision is reproduced with highlight for analysis and in right column analytical remarks are made for easy understanding. Special provisions for payment of tax by The provisions as amended will apply certain persons other than a company w. Special provisions for payment of tax In case there is no such claim than i deductions claimed, if any, under question of AMT will not apply.

Application of other provisions of Other provisions of the Act shall apply. Application of this Chapter to certain The provisions of this section will persons. In Chapter shall apply to a person who has case there is no such eligible claim or claimed any deduction under— a any the assessee does not make such a section other than section 80P included in claim, than the provisions of this Chapter VI-A under the heading "C.

Deductions in respect of certain incomes"; or Thus it is optional on assessee to make b section 10AA. He can 2 The provisions of this Chapter shall not refrain by not making claim and by not apply to an individual or a Hindu undivided filing prescribed report.1.

Supreme Court ruling on non-applicability of Minimum Alternate Tax (MAT) provisions to foreign companies. The Supreme Court of India in its judgement has held that MAT provisions will not apply to foreign companies not having permanent establishment (PE) or place of business in government had earlier clarified vide the press releases that MAT provisions would not be applicable .

Minimum Alternate Tax (MAT) is a tax effectively introduced in India by the Finance Act of , vide Section J of the Income Tax Act, (IT Act), to facilitate the taxation of ‘zero tax companies’ i.e., those companies which show zero or negligible income to avoid tax.

minimum alternate tax (mat) 1. In the case of companies, if tax payable on its total income as computed under the I.T. Act, in respect of any previous years, is less than % of its “book profit”, then such book profit shall be deemed to be the total income of the company and tax shall be payable at % on such total income.

Minimum Alternate Tax (MAT) is a tax payable by companies and falls under the indirect tax category. Let us look at the definition and some of the most prominent traits of this tax.

Let us look at the definition and some of the most prominent traits of this tax. MAT stands for Minimum Alternate Tax and AMT stands for Alternate Minimum Tax. Initially to all other taxpayers in the form of AMT.

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In this part you can gain knowledge about various provisions relating to MAT and AMT. First of all we will understand the provisions of . 1 | P a g e Impact of Ind AS on Minimum Alternate Tax (MAT) -by CA Niketa Agarwal [email protected] +91 Date: 15th June, 1.

Introduction As the book profit based on Ind AS compliant financial statement is likely to be different from the book.

India: Minimum alternate tax on foreign companies | International Tax Review