New Tax Rate: Facts required to be considered.

1.   The Taxation Laws (Ordinance), 2019 has been promulgated by the President of India to amend the Income-tax Act, 1961 and the Finance (No. 2) Act, 2019. The Ordinance has introduced two new corporate tax rates, i.e., at 15% and 25% for the domestic companies. However, the benefit of reduced tax rate shall be available only when total income of the company is computed without claiming specified deductions, incentives, exemptions and additional depreciation available under the  Income-tax  Act.  

INSIGHT: The Arm’s-Length Standard Is Not the Problem

Next year is the 85th anniversary of the adoption of the arm’s-length standard (ALS) by the U.S. government as the norm to be used for pricing transactions among related parties for the purpose of calculating their U.S. corporate income tax (CIT).   

I mportant Clause in TAR Vs ITR

S No.	Clause in TAR	Particulars	Schedule in ITR
1	Form 3CA	In Statutory Audit was carried out by other Audit Firm, mention statutory audit was conducted by "M/s" otherwise "US"	NA
2	3CD-9(b)	Change in Partners / Members	PartA-General 2
3	3CD-10	Nature of Business, Change in Business	PartA-General 2
4	3CD-12	Presumptive Profits	PartA-P&L, Schedule BP
5	3CD-13e	Adjustmemts to ICDS	Schedule ICDS
6	3CD-14	Valuation of Stock U/s 145A	Schedule Part A - OI
7	3CD-16	Amount not credited to P&L A/c a.  Items falling U/s 28 b.  Proforma Credits, drwbacks, refund c.  Escalation claims, Capital Receipts etc	Schedule Part A - OI
8	3CD-18	Depreciation U/s I T Act	Schedule BP, DPM, DOA (Compare last year closing WDV with TAR and ITR)
9	3CD-19	Amounts admissible U/s 32AC - 35E	Schedule BP, ESR, RA
10	3CD-20	Amounts admissible U/s 36(1)(va) (Employee contribution to PF, ESI)	Schedule Part A - OI
11	3CD-21(a)	In TAR, it is only a disclosure. Don’t try to link all disallowance U/s 37 in ITR	Schedule Part A - OI
12	3CD-21(b)	Details of payments on TDS not deducted, TDS unpaid Vs Clause 34(a) of TAR	Schedule Part A - OI
13	3CD-21(c)	Salary, commission, interest paid to partner U/s 40(b)	Schedule Part A - OI
14	3CD-21(d)	Disallowance U/s 40A(3)/(3A)	Schedule Part A - OI
15	3CD-21(e)	Disallowance U/s 40A(7)	Schedule Part A - OI
16	3CD-21(f)	Disallowance U/s 40A(9)	Schedule Part A - OI
17	3CD-21(h)	Disallowance U/s 14A	Schedule Part A - OI
18	3CD-21(i)	Disallowance U/s 36(1)(iii)	Schedule Part A - OI
19	3CD-23	Disclosure of PAYMENTS made to persons covered U/s 40A(2)(b) (Have to disclose all payments made to above parties and it is not limited to expenses)	PartA-BS, Schedule AL (Verify with Related Party Disclosures in Financials)
20	3CD-24	Deemed Profits U/s 32AC, 32AD, 33AB, 33AC, 33ABA	Schedule Part A - OI Schedule BP
21	3CD-25	Deemed Profits U/s 41	Schedule Part A - OI
22	3CD-26(i)(A)(a)	Disallowed U/s 43B in earlier years and paid in current year	Schedule Part A - OI
23	3CD-26(i)(A)(b)	Disclose amounts disallowed U/s 43B in earlier years and not paid in current year	Schedule Part A - OI
24	3CD-26(i)(B)(a)	Disclose payments related to current PY and paid in current PY - U/s 43B	Schedule Part A - OI
25	3CD-26(i)(B)(b)	Disclose payments related to current PY and UNPAID upto filing of ROI - U/s 43B	Schedule Part A - OI
26	3CD-26(i)(A)(a)	Disallowed in earlier years and paid in current year	Schedule Part A - OI
27	3CD-27(a)	Provide details of ITC as per books of accounts	NA
28	3CD-27(b)	Details of Prior Period Income / Expenses	Schedule Part A - OI
29	3CD-29B(a)	Income U/s 56(2)(x)	Schedule OS
30	3CD-30	Amounts borrowed / repaid U/s 69D	Schedule OS
31	3CD-32(a)	Details of Brought Forward Losses	Schedule CFL, UD
32	3CD-32(b)	Change in shareholding U/s 79	PartA-General 2
33	3CD-32(c)	Losses in Speculative Business U/s 73	Schedule BP, BFLA, CFL
34	3CD-32(d)	Losses in Specified Business U/s 73A	Schedule BP, BFLA, CFL
35	3CD-32(e)	Deemed Speculative Business U/s 73	Schedule CFL, UD
36	3CD-33	Deduction U/s Chapter VIA, Section 10A, 10AA	Schedule 10AA, 80G, 80GGA, 80, VIA
37	3CD-34a,b	Details of payments on TDS not deducted, TDS unpaid Vs Clause 34(a) of TAR (verify with Financials, TDS returns)	NA
38	3CD-34c	Interest paid U/s 201(1A), 206C(7)	Schedule Part A - OI
39	3CD-35	Quantitative details of Inventory	Schedule Part A - OD
40	3CD-36	Details of Distributed Profits U/s 115O	Schedule DDT
41	3CD-36A(a)	Details of deemed dividends U/s 2(22)e	Schedule AL
42	3CD- 40	Details of various ratios	PartA-Trading A/c, P&L