CBDT extends Tax ITR filing deadline to October 31

The Central Board of Direct Taxes (CBDT) has decided to extend the deadline for filing of ITRs and Tax Audits Reports by a month.  Given the relentless demands by Chartered Accountants (CAs) and tax consultants, the CBDT has given a breather till October 31. It will also provide some respite to smaller companies too, who are struggling with GST filings.

Last night, the CBDT tweeted: “On consideration of representations recd from across the country, CBDT has decided to extend the due date for filing of ITRs & Tax Audit Reports from 30th Sep, 2019 to 31st of Oct, 2019 in respect of persons whose accounts are required to be audited.formal Notification will follow.

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brief introduction to domestic company under income tax act

Meaning​

As per Section 2(22A)​, "domestic company" means an Indian company, or any other company which, in respect of its income liable to tax under this Act, has made the prescribed arrangements for the declaration and payment, within India, of the dividends (including dividends on preference shares) payable out of such income

Tax Rates

A. Income-tax

·         In the case of a domestic company 30 % of the total income;

·         but in case total turnover or the gross receipt in the previous year 2017-18 does not exceed Rs. 400 crore than the rate of tax will be 25% In the case of a domestic company

The amount of income-tax computed shall, be increased by a surcharge,-

Surcharge rate :

Particulars	Tax Rate
If total income exceeds Rs. 1 crore but not Rs. 10 Crore	7% of tax calculated on domestic company/ 2 % of tax calculated on foreign company as per above rates
If total income exceeds Rs. 10 crore	12% of tax calculated on domestic company/ 5 % of tax calculated on foreign company as per above rates

Provided that in the case of every company having a total income exceeding one crore rupees but not exceeding ten crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees :

Provided further that in the case of every company having a total income exceeding ten crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax and surcharge on a total income of ten crore rupees by more than the amount of income that exceeds ten crore rupees.

Health and Education Cess

The amount of income-tax as increased by the applicable surcharge, shall be further increased by "Health and Education Cess on income-tax", calculated at the rate of four per cent of such income-tax and surcharge

B. Minimum Alternate Tax

A company shall be liable to pay MAT @ 18.5% of book profit (plus surchage and health and Education Cess as applicable) where the normal tax liability of the company is less than 18.5% of book profit.

Dividend Distribution Tax (DDT)

Companies are required to pay tax on the dividend distributed to the shareholders in a particular year. This dividend is exempted in the hands of shareholders upto an amount of Rs. 10 lakh but the companies have to pay tax @ 20.56 %.

New Updates

The Centre slashed effective corporate tax to 25.17 per cent, inclusive of all cess and surcharges, for domestic companies. Making the announcement, Finance Minister  said the new tax rate will be applicable from the current fiscal which began on April 1.

·         New provision inserted in the income tax act with effect from fiscal year 2019-20, that allows any domestic company to pay income tax at the rate of 22% subject to condition they will not avail any incentive or exemptions.

·         Manufacturing companies set up after October 1 to get option to pay 15% tax. Effective tax rate for new manufacturing firms to be 17.01% inclusive of surcharge & tax.

·         Listed companies that have announced buyback before July 5, 2019, tax on buyback of shares will not be charged

·         Higher surcharge will also not apply on capital gains on sale of security including derivatives held by FPIs

·         Enhanced surcharge will not apply to capital gains arising on equity sale or equity-oriented funds liable to STT stabilise flow of funds into capital markets

·         To provide relief to companies availing of concessions and benefits, a MAT relief by reducing it from 18% to 15%

·         CSR 2% spending to include government, PSU incubators and public funded education entities, IITs

New domestic manufacturing companies incorporated after October 1, can pay income tax at a rate of 15 per cent without any incentives. Meaning, effective tax rate for new manufacturing companies will be 17.01 per cent inclusive of all surcharge and cess.

TDS Rates Under DTAA

Withholding tax rates

Country	Dividend (not being covered under Section 115-O)	Interest	Royalty	Fee for Technical Services
Albania	10%	10%[Note1]	10%	10%
Armenia	10%	10% [Note1]	10%	10%
Australia	15%	15%	10%/15% [Note 2]	10%/15% [Note 2]
Austria	10%	10% [Note1]	10%	10%
Bangladesh	a) 10% (if at least 10% of the capital of the company paying the dividend is held by the recipient company); b) 15% in all other cases	10% [Note1]	10%	No separate provision
Belarus	a) 10%, if paid to a company holding 25% shares; b) 15%, in all other cases	10% [Note1]	15%	15%
Belgium	15%	15% (10% if loan is granted by a bank)	10%	10%
Bhutan	10%	10% [Note 1]	10%	10%
Botswana	a) 7.5%, if shareholder is a company and holds at least 25% shares in the investee-company; b) 10%, in all other cases	10% [Note1]	10%	10%
Brazil	15%	15% [Note1]	a) 25% for use of trademark; b) 15% for others	No separate provision
Bulgaria	15%	15% [Note1]	a) 15% of royalty relating to literary, artistic, scientific works other than films or tapes used for radio or television broadcasting; b) 20%, in other cases	20%
Canada	a) 15%, if at least 10% of the voting powers in the company, paying the dividends, is controlled by the recipient company; b) 25%, in other cases	15% [Note1]	15%-20%	15%-20%
China	10%	10% [Note1]	10%	10%
Columbia	5%	10% [Note1]	10%	10%
Croatia	a) 5% (if at least 10% of the capital of the company paying the dividend is held by the recipient company); b) 15% in all other cases	10% [Note1]	10%	10%
Cyprus	10%	10% [Note1]	10%	10%
Czech Republic [Note5]	10%	10% [Note1]	10%	10%
Denmark	a) 15%, if at least 25% of the shares of the company paying the dividend is held by the recipient company; b) 25%, in other cases	a) 10% if loan is granted by bank; b) 15% for others [Note1]	20%	20%
Estonia	10%	10% [Note1]	10%	10%
Ethiopia	7.5%	10% [Note1]	10%	10%
Finland	10%	10% [Note1]	10%	10%
Fiji	5%	10% [Note 1]	10%	10%
France	10%	10% [Note1]	10%	10%
Georgia	10%	10% [Note1]	10%	10%
Germany	10%	10% [Note1]	10%	10%
Hongkong	5%	10% [Note1]	10%	10%
Hungary	10%	10% [Note1]	10%	10%
Indonesia	10%	10% [Note1]	10%	10%
Iceland	10%	10% [Note1]	10%	10%
Ireland	10%	10% [Note1]	10%	10%
Israel	10%	10% [Note1]	10%	10%
Italy	a) 15% if at least 10% of the shares of the company paying dividend is beneficially owned by the recipient company; b) 25% in other cases	15% [Note1]	20%	20%
Japan	10%	10% [Note1]	10%	10%
Jordan	10%	10% [Note1]	20%	20%
Kazakhstan	10%	10% [Note1]	10%	10%
Kenya	10%	10%	10%	10%
Korea	15%	10%	10%	10%
Kuwait	10% [Note 1]	10%	10%	10%
Kyrgyz Republic	10%	10% [Note1]	15%	15%
Latvia	10%	10% [Note1]	10%	10%
Lithuania	5%*, 15%	10% [Note1]	10%	10%
Luxembourg	10%	10% [Note1]	10%	10%
Malaysia	5%	10% [Note1]	10%	10%
Malta	10%	10% [Note1]	10%	10%
Mongolia	15%	15% [Note1]	15%	15%
Mauritius	a) 5%, if at least 10% of the capital of the company paying the dividend is held by the recipient company; b) 15%, in other cases	7.5	15%	10%
Montenegro	5% (in some cases 15%)	10% [Note1]	10%	10%
Myanmar	5%	10% [Note1]	10%	No separate provision
Morocco	10%	10% [Note1]	10%	10%
Mozambique	7.5%	10% [Note1]	10%	No separate provision
Macedonia	10%	10% [Note 1]	10%	10%
Namibia	10%	10% [Note1]	10%	10%
Nepal	5%**, 10%	10% [Note1]	15%	No separate provision
Netherlands	10%	10% [Note1]	10%	10%
New Zealand	15%	10% [Note1]	10%	10%
Norway	10%	10% [Note1]	10%	10%
Oman	a) 10%, if at least 10% of shares are held by the recipient company; b) 12.5%, in other cases	10% [Note1]	15%	15%
Philippines	a) 15%, if at least 10% of the shares of the company paying the dividend is held by the recipient company; b) 20%, in other cases	a) 10%, if interest is received by a financial institution or insurance company; b) 15% in other cases [Note1]	15% if it is payable in pursuance of any collaboration agreement approved by the Government of India	No separate provision
Poland	10%	10% [Note1]	15%	15%
Portuguese Republic	10%***/15%	10%	10%	10%
Qatar	a) 5%, if at least 10% of the shares of the company paying the dividend is held by the recipient company; b) 10%, in other cases	10% [Note1]	10%	10%
Romania	10%	10% [Note1]	10%	10%
Russian Federation	10%	10% [Note1]	10%	10%
Saudi Arabia	5%	10% [Note1]	10%	No separate provision
Serbia	a) 5%, if recipient is company and holds 25% shares; b) 15%, in any other case	10% [Note1]	10%	10%
Singapore	a) 10%, if at least 25% of the shares of the company paying the dividend is held by the recipient company; b) 15%, in other cases	a) 10%, if loan is granted by a bank or similar institute including an insurance company; b) 15%, in all other cases	10%	10%
Slovenia	a) 5%, if at least 10% of the shares of the company paying the dividend is held by the recipient company; b) 15%, in other cases	10%	10%	10%
South Africa	10%	10% [Note1]	10%	10%
Spain	15%	15% [Note1]	10%/20% [Note 3]	20% [Note 3]
Sri Lanka	7.5%	10% [Note1]	10%	10%
Sudan	10%	10%[Note1]	10%	10%
Sweden	10%	10% [Note1]	10%	10%
Swiss Confederation	10%	10%[Note1]	10%	10%
Syrian Arab Republic	a) 5%, if at least 10% of the shares of the company paying the dividend is held by the recipient company; b) 10%, in other cases	10%[Note1]	10%	No separate provision
Tajikistan	a) 5%, if at least 25% of the shares of the company paying the dividend is held by the recipient company; b) 10%, in other cases	10%[Note1]	10%	No separate provision
Tanzania	5%****, 10%	10%	10%	No separate provision
Thailand	10%	10% [Note1]	10%	No separate provision
Trinidad and Tobago	10%	10% [Note1]	10%	10%
Turkey	15%	a) 10% if loan is granted by a bank, etc.; b) 15% in other cases [Note1]	15%	15%
Turkmenistan	10%	10% [Note1]	10%	10%
Uganda	10%	10%[Note1]	10%	10%
Ukraine	a) 10%, if at least 25% of the shares of the company paying the dividend is held by the recipient company; b) 15%, in other cases	10% [Note1]	10%	10%
United Arab Emirates	10%	a) 5% if loan is granted by a bank/similar financial institute; b) 12.5%, in other cases	10%	No separate provision
United Mexican States	10%	10% [Note1]	10%	10%
United Kingdom	15%/10% (Note 4)	a) 10%, if interest is paid to a bank; b) 15%, in other cases [Note1]	10%/15%[Note 2]	10%/15%[Note 2]
United States	a) 15%, if at least 10% of the voting stock of the company paying the dividend is held by the recipient company; b) 25% in other cases	a) 10% if loan is granted by a bank/similar institute including insurance company; b) 15% for others	10%/15%[Note 2]	10%/15%[Note 2]
Uruguay	5%	10% [Note1]	10%	10%
Uzbekistan	10%	10% [Note1]	10%	10%
Vietnam	10%	10% [Note1]	10%	10%
Zambia	a) 5%, if at least 25% of the shares of the company paying the dividend is held by a recipient company for a period of at least 6 months prior to the date of payment of the dividend; b) 15% in other cases	10% [Note1]	10%	10%

*If the beneficial owner is a company (other than a partnership) which holds directly at least 10 per cent of the capital of the company paying the dividends.

**5% if beneficial owner of shares is a company and it holds at least 10% of shares of the company paying the dividends.

*** if the beneficial owner is a company that, for an uninterrupted period of two fiscal years prior to the payment of the dividend, owns directly at least 25 per cent of the capital stock of the company paying the dividends.

****5% if recipient company owns at least 25% share in the company paying the dividend.

 1. Dividend/interest earned by the Government and certain specified institutions, inter-alia, Reserve Bank of India is exempt from taxation in the country of source (subject to certain condition).

 2. Royalties and fees for technical services would be taxable in the country of source at the rates prescribed for different categories of royalties and fees for technical services. These rates shall be subject to various conditions and nature of services/royalty for which payment is made. For detailed conditions refer to relevant Double Taxation Avoidance Agreements.

 3. Royalties and fees for technical services would be taxable in the country of source at the following rates:

a. 10 per cent in case of royalties relating to the payments for the use of, or the right to use, industrial, commercial or scientific equipment;

b. 20 per cent in case of fees for technical services and other royalties.

4. (a)15 per cent of the gross amount of the dividends where those dividends are paid out of income (including gains) derived directly or indirectly from immovable property within the meaning of Article 6 by an investment vehicle which distributes most of this income annually and whose income from such immovable property is exempted from tax;

(b) 10 per cent of the gross amount of the dividends, in all other cases

5. The CBDT has clarified that DTAA signed with Government of the Czech Republic on the 27th January 1986 continues to be applicable to the residents of the Slovak Republic. [Notification No. 25, dated 23-03-2015]

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