CBDT notifies forms on revised corporate tax
The Income-Tax (I-T) Department has notified forms for companies to avail of the reduced corporate tax rates that were announced in September 2019.
New Delhi: The Income-Tax (I-T) Department has notified forms for companies to avail of the reduced corporate tax rates that were announced in September 2019.
The Central Board of Direct Taxes (CBDT) has notified Forms 10-IC and 10-ID for existing companies that want to avail of lower I-T rate and new manufacturing firms, respectively.
In September 2019, the central government announced a cut in base corporate tax for existing companies to 22 per cent from the current 30 per cent.
For new manufacturing firms, incorporated after October 1, 2019, and starting operations before March 31, 2023, the Centre has also lowered to 15 per cent from the current 25 per cent.
Companies opting for these new tax rates will have to forego all exemptions and incentives.
The effective tax rate for existing units, after considering surcharges and cess such as Swachh Bharat cess and education Cess -- which are levied on top of the income and corporate tax rates, will be 25.17 per cent as compared to 34.94 per cent now.
For new units, it will be 17.01 per cent as against 29.12 per cent now.
Form 10-IC will have to be filed by the companies that wish to avail the beneficial rate of 22 per cent upon relinquishment of the exemptions/incentives offered under the Income Tax Act.