Beneficial Tax Rate for Domestic Companies

1. Section 115BAA has been inserted in the Income Tax Act,1961 to give the benefit of a reduced corporate tax rate for all domestic companies. Section 115BAA states that domestic companies have the option to pay tax at a rate of 22% plus a surcharge of 10% and cess of 4%.

2. The company shall not claim deductions U/S 10A, 33AB, 35AD, 35CCC, 35CCD, Chapter VIA except for 80JJAA, additional depreciation, set off of losses in respect of above.

3. The beneficial tax rate shall be opted for by the due date of filing returns.

4. Such companies shall not be required to pay MAT.

5. Set off of brought forward depreciation and MAT credit shall not be allowed.

6. The option should be in Form 10-IC, as notified by the CBDT. The form should be submitted online under a digital signature or EVC.

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