Income-tax Act, 2025

Special provision for minimum alternate tax and alternate minimum tax. - Section 206

D.Special provisions relating to minimum alternate tax and alternate minimum tax

Special provision for minimum alternate tax and alternate minimum tax

206. (1)(a) Irrespective of anything contained in any other provision of this Act, where in the case of an assessee being a company, the income-tax payable on the total income as computed under this Act for a tax year is less than the minimum alternate tax payable for such tax year, then

(i) the book profit shall be deemed to be the total income of that assessee for such tax year; and

(ii) the assessee shall be liable to pay income-tax equal to the minimum alternate tax.

(b) For the purposes of clause (a), the expressions "minimum alternate tax" means the amount of tax computed on the book profit

(i) in case of a company being a unit located in an International Financial Services Centre and deriving its income solely in convertible foreign exchange, at the rate of 9%;

(ii) in case of any other company, at a rate of 28[14%].

(c) For the purposes of this section, "book profit" means the profit as shown in the statement of profit and loss for the relevant tax year prepared as per clause (f), as increased by

(i) income-tax paid or payable and the provision therefor, if any such amount is debited to the statement of profit and loss, where income-tax shall include

(A) any interest charged under this Act;

(B) surcharge, if any, as levied under the Central Acts;

(C) Education Cess on income-tax, if any, as levied under the Central Acts; and

(D) Secondary and Higher Education Cess on income-tax, if any, as levied under the Central Acts;

(ii) the amounts carried to any reserves, called by any name, if any such amount is debited to the statement of profit and loss;

(iii) the amount or amounts set aside to provisions made for meeting liabilities, other than ascertained liabilities, if any such amo .... To read the full section download the app from Google Play store