Deferred tax

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Angshuman Tamuly (Querist)
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17 June 2013 A company has 100% exemption u/s 80IC of IT Act and its been, hence, paying MAT u/s 115JB. It calculates depreciation as per rates prescribed by Schedule XIV of Companies Act. Shall it create Deferred Tax Asset/Liab on the excess/reduced tax liability due different rates of Depn as per IT Act? If yes, what should be the rate, MAT rate or 30.9%?

CA Suraj Lakhotia

CA Suraj Lakhotia (Expert)
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17 June 2013 As per ASI - 6

In a period in which a company pays tax under section 115JB of the Act, the deferred tax assets and liabilities in respect of timing differences arising during the period, tax effect of which is required to be recognised
under AS 22, should be measured using the regular tax rates and not the tax
rate under section 115JB of the Act.

CA Suraj Lakhotia

CA Suraj Lakhotia (Expert)
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17 June 2013 Refer ASI - 3 for illustration for DTA/DTL for tax holiday cases.

http://220.227.161.86/315asi_accstand3.pdf

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