CBDT extends compliance deadline for capital gains tax waiver on residential properties

Income Tax

ITR: Missed deadline of December 31, 2022, to file these ITRs for FY 2021-22 (AY 2022-23)? Here’s what you can do

• Jan 07, 2023
• 
  
  
  

If you are one of those individuals who missed the last date of December 31, 2022, to file a belated or revised income tax return for FY 2021-22 (AY 2022-23), fret not. There is still a chance for you to file the ITR.

Budget 2022 has introduced the option to file an updated ITR (ITR-U) for those individuals who have missed the chance to file a tax return for a financial year.

Before this, an individual could file income tax returns of three types: original (filed on or before the due date), belated (filed on or before December 31) or revised (submitted after the original is filed but on or before December 31).

But taxpayers cannot file an updated ITR or an ITR-U before the assessment year comes to an end — March 31, 2023, in this case.

Income Tax

I-T Goes After Rs 7.7 Trillion Tax Arrears

Income Tax

Corporate tax to GDP ratio exceeds 3 pc after two years in FY’22

• Jan 02, 2023
• 
  

Corporate tax collections exceeded 3 per cent of the GDP after a gap of two years in 2021-22, reflecting overall improvement in profitability of India Inc propelled by increase in demand for goods and services.

However, the corporate tax collection is yet to surpass its five-year high of 3.51 per cent of GDP recorded in 2018-19.


In actual terms, the net corporate tax collection in 2021-22 stood at Rs 7.12 lakh crore. The Gross Domestic Product (GDP) at current market price was Rs 236.64 lakh crore. The percentage of net corporate tax to GDP worked out to be 3.01 per cent.

Income Tax

Appointment of foreign national as a director of Indian company

10th Jan, 2023

Under Indian Companies Act, 2013, six types of Directors are appointed in a company, i.e., Women Director, Independent Director, Small Shareholders Director, Additional Director, Alternative and Nominee Director. The Act does not bar a foreign national to be appointed as any of the above-mentioned directors in Indian Companies by complying with the Companies Act, 2013 (hereinafter referred as “The Act”) read along with the Companies (Appointment and Qualifications of Directors) Rules, 2014 (hereinafter referred as “The Rules”)

Corporate Laws

Incidence of Section 112A to be taxed at MMR u/s 115UA of IT Act 1961

11th January, 2023

Section 115UA of the income tax act, 1961, INTER-ALIA, provides that notwithstanding anything contained in any other provisions of this act, any income distributed by a business trust to its unit holders shall be deemed to be of the same nature and in the same proportion in the hands of the unit holder as it had been received by, or accrued to, the business trust. Further, subject to the provisions of Section 111A and Section 112, the total income of a business trust shall be charged to tax at the maximum marginal rate (MMR). Maximum marginal rate or MMR, in relation to a trust, shall refer to maximum marginal rate applicable as per finance act 2022, which is 42.744%. Thus, it is interesting to note that while Section 115UA taxes all income at MMR, it however provides exceptional relief for income in the nature of long-term capital gain u/s 112 and short-term capital gain in cases of income from transfer of equity shares or unit of equity oriented fund or unit of business trust (where STT is payable on such transfer) u/s 111A, as an exception and allows them to be taxed at their usual rates. The usual rates are 20% for long-term capital gain u/s 112 and 15% for short-term capital gain in the nature of income referred to in Section 111A above. Thus, it makes clear that the purpose of this Section is to tax any income pertaining from the special purpose vehicle to the business trust (other than the usual interest and dividend it receives) at MMR except long term capital gain and short-term capital gain u/s 112 and 111A respectively.

Income Tax

Transfer Pricing in India: A Comprehensive overview with key case studies

10th January, 2023

Transfer pricing refers to the pricing of goods and services traded between related parties, such as subsidiaries of the same multinational corporation. It is an important aspect of international business, as it can significantly impact a company's profitability and tax liability. In recent years, transfer pricing has come under scrutiny by governments worldwide, as it can be used as a means of tax avoidance or evasion. In India, transfer pricing is regulated by the Income Tax Act 1961 and the rules prescribed thereunder. The Central Board of Direct Taxes (CBDT) is responsible for enforcing India's transfer pricing regulations.

Hero Moto Corp Vs. DCIT, Delhi [2020] 117 taxmann.com 101 (Delhi - Trib.) In this case, the Delhi Tribunal considered the issue of whether the cost plus method was the most appropriate transfer pricing method for determining the arm's length price of a transaction involving the procurement of raw materials by the taxpayer, Hero Moto Corp. The taxpayer argued that the cost-plus method was the most appropriate method, as it took into account the specific circumstances of the transaction and the taxpayer's contribution to the value of the raw materials.

Income Tax

Online registration of units through MCA portal for ESI registration and inspection of units

10th January,2023
Newly incorporated Public Limited, Private Limited and One Person Companies registered with effect from February 15, 2020 ['Companies'] are being allotted ESIC registration number by default at the time of its incorporation. Once these Companies are registered under Employee State Insurance Act, 1948 ['ESI Act'] they will have to comply with the provisions of ESI Act mandatorily as their registration becomes active automatically on generation from the date of incorporation, irrespective of whether these Companies fall under the ambit of the thresholds limits as applicable[1]. However, it raised a new challenge before the Employee State Insurance Corporation to identify whether these Companies fall under the thresholds or not? To meet the above issue, Employee State Insurance Corporation had released a Circular in this regard dated December 22, 2022 which states that Companies who have got default registration under ESI Act on incorporation through MCA portal need not comply with the provisions of ESI Act for a period of six months from the date of registration or until it exceeds the thresholds as specified under ESI Act, whichever is earlier.

Corporate Laws