MAT Calculation

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Jayant Shaligram (Querist)

22 August 2007 Hello friends,

This is a pending query for last one month. If any one can help we nned to work out payment of Advance Tax.

QUERY :

A software company has two units. One is 100% EOU claiming expemption us/ 10 A. The other unit is also 100% EOU but not claiming 10 A exemption.

The unit claiming 10 A exemption is making profits and the other non 10 A unit is incurring losses for long time.

However, the losses for the non 10 A units are not more than profit of the unit claiming 10 A exemption.

Can any one help me with working out MAT liability by substing hypothetical figures?

The company has skipped its advance tax payemnt if any due in June, for want of MAT calculation.

Thank you.

Jayant Shaligram

Raj

Raj (Expert)

23 August 2007 In your case definitely MAT as well as Advance tax provision will applicable.
MAT is payable on your accouting profit after adjustment of 13 items (+or -) specified of Act. U/S 10A ur company is exempted up to 31.03.09 for regular provision of income tax. for non 10A company will come under normal provision of tax. you had to pay 15 % of tax liability on 15.06.07 now on 15 sep. you should pay 45% of total tax liability.

Jitender

Jitender (Expert)

23 August 2007 I THINK ADJUSTMENTS OF MAT IS GOVERNED BY SEC 1115JB & NOT 10A.

Raj

Raj (Expert)

23 August 2007 Here question about sec. 10A exemption for STPI/100% EOU & latest update about MAT . Obviously sec1115JB for MAT

Jayant Shaligram

Jayant Shaligram (Querist)

23 August 2007 Hello friends,

The company here is only one. And it has two different units, one is a 10 A unit and other is not. Had there been two different companies there was no problem.

How to work out the tax liability under MAT for a company having two different units ismy problem.

The company is filing return setting off loss of non 10 A unit against net profit of 10 A unit and the Balance is then claimed as exemption.

Could any one explain to me with the hypothetical figures as how the working should be done ?

Thank you all

vishal

vishal (Expert)

15 November 2007 Hi Jayant
Let take two different name for both the unit P = Profit making & claiming exemption
Unit N = Non profit & non exemption claiming unit

Let till last years net incomes are P = 50
& N = -40

Let Current year net income before Taxes are P = 10 & N= -6 net income 4
then no question of mat as after eleminating P there is book loss

Second situation P = 10 & N = 4

Then no question of MAT as b/f book loss of unit N

Take another example that there are no b/f loss & fisrt sitation

no question of Mat as loss & in second sitation MAT Profit u/s 115 jb is 4

If there is mat liability then there is no question of Advance Tax

thanx

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