Mat Computation For Ay 15 16

Is mat applicable for ay 2020 21.

Mat computation for ay 15 16. The taxation laws amendment bill 2019 proposed to insert a proviso to section 115jb 1 of the act that the rate shall be reduced from 18 5 to 15 from previous year commencing on or after april 1 2020. Mat is equal to 18 5 15 from ay 2020 21 of book profits plus surcharge and cess as applicable. The present mat rate as of fy 2019 20 is 15 of book profit previously 18 5 plus applicable cess and surcharge. Mat is calculated at 15 of the book profit as per section 115jb of income tax act 1961.

Book profit calculator downloads income tax calculator section 115jb. 2012 13 2011 12 2010 2011 tags. How to calculate mat. Payable tax cannot be less than the 18 5 of book profit in an assessment year the mat rate has been reduced to 15 from fy 19 20.

Complexity in computing the book profit under mat provisions and recent changes in accounting standards have further increased the tax compliance burden for companies. All companies are required to pay corporate tax based on which is higher of the following. The minimum alternative tax mat is a provision introduced in direct tax laws to limit the tax deductions exemptions otherwise available to taxpayers so that they pay a minimum amount of tax to the government. Tax liability as per the mat provisions are given in sec 115jb 18 5 of book profits plus 4 education cess plus a surcharge if applicable.

By shinewingindia december 16 2019 in order to provide relief to the corporates an amendment was made in the section 115jb of the income tax act 1961 the act by the taxation laws ordinance 2019 whereby the rate of mat was reduced from 18 5 to 15 with effect from ay 2020 21. It means as per the bill the reduced rate of 15 per cent for mat is applicable from ay 2021 22. There are specific provisions under the income tax act 1961 under which the mat is collected from every company it is calculated under section 115jb of the income tax act. Easing the mat credit mechanism and simplifying the mat computation provisions on the.

Minimum alternative tax mat and its computation of book profit and mat credit under section 115jb of income tax act 1961. For calculating the tax outflow of company first the tax is required to be calculated. Of credit has been allowed up to 15 years. The tax rate is 15 with effect from ay 2020 21 fy 2019 20 2.

How is mat calculated. There is a credit of mat of 4 68 000 which can be carried forward to 15 assessment year. Hence the bill had proposed to defer the. Analysis of provision of section 115jb where in case of a company the income tax payable on the total income as computed under the income tax act in respect of any previous year is less than 15 of its book profit then such book profit shall be deemed to be the total income of the assessee and the tax.