Tax Rate of New Company

[KrishnaKumar A]

Hi Experts,

One of my client is a new company, incorporated in FY 2018-19. It's turnover is less than 5 crore during the FY. The company was not in existence during the FY 2016-17 and turnover criteria of 250 Crore may not be applicable here. Its a service sector company and section 115BA is not applicable also. It would be great if anyone can clarify what is the tax rate for this company? 25% or 30%?

Thank you.

[Guest]

Hello Dear

Since Sec 115BA is not applicable to your client, tax rate for your client is 30%.

[CASusheel Gupta]

Section 115BA is special section.

Tax rate for all companies, except covered under section 115BA, having turnover less than 250 crore is 25%.

Refer to Section 2 of Finance Act (No. 2) 2019 for tax rate.

CA Susheel Gupta

AI Summary

New Service Company Challenges Tax Rate; Debate Over Applicability of 25% or 30% Under Finance Act 2019 A client, a new service sector company incorporated in FY 2018-19 with a turnover under 5 crore, seeks clarification on its applicable tax rate, questioning whether it should be 25% or 30%. Neekita Jindal responds that since Section 115BA does not apply, the tax rate is 30%. However, CA Susheel Gupta counters that for companies not covered under Section 115BA and with turnover below 250 crore, the tax rate is 25%, referencing Section 2 of the Finance Act (No. 2) 2019.