Domestic companies - Eligible Rate of Inconme tax for A.Y 2018-19

[gvenugopal g]

Dear All,

Kindly suggest us, whether applicability of tax rate is 25% or 30% for A.Y 2017-18 & 2018-19

Company incorporated on 16-Dec-2015

Turnover (Rupees in Crore) of last three financial years are

FY 2015-16 ₹ 37.42,

FY 2016-17 ₹ 236.22 and

FY 2017-18 ₹ 108.55

For the Assessment Years 2017-18 & 2018-19, whether the above domestic company is eligible for Income tax payable at the rate of 25%

Kindly suggest whether we need to pay Income tax @ 25% or 30%

[DR.MARIAPPAN GOVINDARAJAN]

Already replied.

[gvenugopal g]

To - DR.MARIAPPAN GOVINDARAJAN

Respected Sir

You have replied for rate of tax for 115BA companies as below:

The first condition of Section 115BA(2) is not fulfilled your company is not eligible to pay tax at 25%. (The company is not incorporated after 01.04.2016).

But my second query is relating to a domestic company with turnover below ₹ 250 Crore and turnover below ₹ 50 Crore for P.Y 2015-16

( NOT for Tax on income of certain domestic companies u/s 115 BA)

Are you still contending that the company is not eligible to pay tax at 25%

Apart from this

The first condition of Section 115BA(2) is the company should have been incorporated on or after 01.03.2016 and NOT 01.04.2016.

Kindly confirm

[DR.MARIAPPAN GOVINDARAJAN]

Yes, I confirmed the reply.

AI Summary

Eligibility for reduced corporate tax rate hinges on incorporation date and turnover thresholds, affecting claim to lower tax regime.
Qualification for the concessional 25% tax rate turns on two operative requirements: the company's incorporation date and prescribed turnover thresholds. The company, incorporated on 16 December 2015, provided turnover figures below the higher threshold, but the advisor advised ineligibility under Section 115BA(2) because the company was incorporated before the required cut-off date; the taxpayer disputed the exact cut-off date cited but did not supply conflicting statutory authority.