Special provisions in respect of newly established units in Special Economic Zone (SEZ) - Section 10AA

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.... before the due date. [Amended by FA, 2023] Essential conditions to claim deduction:- * The unit in SEZ begins to manufacture or produce articles or things or provide services during the financial year 2005-06 or any subsequent year. * It is not formed by splitting up, or reconstruction, of a business already in existence. However deduction is allowed in case unit is formed by result of re-establishment, reconstruction or revival of the business. * It is not formed by a transfer to a new business of machinery and plant previously used for any purpose. However deduction shall be allowed if the total value of the second hand machinery does not exceed 20% of the total value of machinery or plant used in the industrial unit. * It is a....

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....freight, telecommunication charges or insurance attributable to the delivery of the articles or things outside India or expenses, if any, incurred in foreign exchange in rendering of services (including computer software) outside India. Limit of Deduction In computing the total income of an undertaking, which begins to manufacture or produce articles or things or computer software in any SEZ, the deduction shall be: i. For first 5 Assessment Years - 100% of export profits ii. For next 5 Assessment Years - 50% of such profits or gains iii. For next 5 Assessment Years - Amount debited to Profit & Loss Account and credited to SEZ Reinvestment Allowance Reserve A/c subject to a maximum of 50% of export profits. Explanation - It has bee....

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....change, within a period of six months from the end of the previous year period as may be permitted by the RBI, but does not include freight, telecommunication charges or insurance attributable to the delivery of the articles or things or computer software outside India or expenses, if any, incurred in foreign exchange in providing the technical services outside India. * If deduction is claimed under section 10AA in respect of a specified business u/s Section 35AD , no deduction in respect of that business is available under section 35AD. * Provisions related to amalgamation and demerger: The benefit under this section is not available to the amalgamating or the demerged company for the previous year in which the amalgamation or the deme....