SECTION 115BAA & FROM 10IC

SECTION 115BAA & FROM 10IC

Ayush License in India

The Domestic organizations ought to record Form 10-IC to practice the choice according to Section 115BAA of the Income Tax Act. By Filling Form 10-IC, the Domestic organization can pay Tax at Recued rate of 22% (in addition to Surcharge and cess), liable to satisfying determined conditions. The said structure ought to be submitted before the due date of ITR documenting (indicated in the Income Tax Act) of the monetary year starting on or after first April 2020.

For: Domestic Company (All Indian Companies cover no exception)

Normal Tax Rate (Old Regime): 

  • If turnover less than 400 Crore:  25% Basic Tax plus 10% Surcharge and 4% cess

  • If turnover More than 400 Crore:  30% Basic Tax plus 10% Surcharge and 4% cess

Reduced Tax Rate After Filing for 10IC (New Regime): 

  • Any turnover: 22% Basic Tax plus 10% Surcharge and 4% cess)

Is Form 10-IC required to be filed by all applicable taxpayers (Domestic Companies)?

  • No. This is optional. Form 10-IC is required to file only one time if a Domestic Company chooses to pay tax at a concessional rate of 22, but upon exercising the option in a particular AY, It cannot be withdrawn later and must be used in all subsequent assessment years.

How can I file Form 10-IC?

  • Can file Form 10-IC only in online mode after logging into the e-filing portal. Form needs to be e-verified using DSC Only

Due date:

  • CBDT issues Income Tax Circular 06/2022 Dated: 17th March 2022 Form 10-IC can now be filed till 30 June 2022

Pros: 

  • Reduced Tax Rate

  • MAT provisions Not Applicable

Cons:

  • Brought forward losses cannot allow to setoff from current year profits

  • Unabsorbed depreciation cannot allow to set off from current year profits

  • MAT Credit Not Allowed to setoff from current year tax

  • Certain other special expenses & deductions are also not allowed to claim

When this option is to be exercised?

The correct answer to this question can only be answered after computing and comparing the tax liability under both regimes, however, it should not be advisable to opt new regime if there is brought forward losses, unabsorbed depreciation, or MAT credit available to setoff. 

27 Apr

Prem Singh
Prem

Right guidance is all we need for a healthy business. Neusource is here to show you the right way which helps you to grow with your business. If you have this wish to build up your startups then neusource is the only choice for your business