Biometric Based Aadhaar Authentication and Risk-Based Physical Verification in GST Registration

 Important Update on CBIC notifies Amendments to implement Biometric Based Aadhaar Authentication and Risk-Based Physical Verification in GST Registration

The Central Board Of Indirect Taxes and Customs (CBIC) has notified amendments to implement biometric based aadhaar authentication and risk-based physical verification in GST registration. The amendments to the Central Goods and Services Tax (Amendment) Rules, 2023 aim to enhance the efficiency and security of the GST registration.

By the latest amendment, the Board has substituted Rule 8(4A) of the CGST Act, 2017 which suggested that the date of submission of the application in cases shall be the date of authentication of the Aadhaar number, or fifteen days from the submission of the application in Part B of FORM GST REG-01 under sub-rule(4), whichever is earlier.

As per sub-section 4A of Rule 8, the application undergoes authentication of the Aadhaar number for the grant of GST registration.

The notification stated that every application made under sub-rule (4) by a person, other than a person notified under section 25 (6D), who has opted for authentication of an Aadhaar number and is identified on the common portal, based on data analysis and risk parameters.

The above-said procedure shall be followed by biometric-based Aadhaar authentication and taking photographs of the applicant where the applicant is an individual about the applicant where the applicant is not an individual, along with the verification of the original copy of the documents uploaded with the application in FORM GST REG-01 at one of the Facilitation Centres notified by the Commissioner.

It is important to note that as per the CBIC notification the application shall be deemed to be complete only after the completion of the process laid down under the above-said provision.

Legal submission to counter 14A disallowance

 “Expenditure incurred in relation to income not includible in total income.

14A. (1) For the purposes of computing the total income under this Chapter, no deduction shall be allowed in respect of expenditure incurred by the assessee in relation to income which does not form part of the total income under this Act.

Decoding PAN, TAN and GST Numbers.

 

Our endeavor is to comprehend the underlying structure of tax identification numbers such as PAN, TAN, and GST, and explore the methods to extract pertinent information from these numbers.

Cash Flow Analysis

 Cash flow is the amount of money that flows in and out of a business or individual's bank account over a certain period. It is an important financial metric that indicates the amount of cash a business or individual has available to meet its financial obligations, such as paying bills, salaries, and taxes.

Amortisation of SPV debt” by REITs/INVITs will be taxed.

 Key amendment include the changes to the way in which the distribution component “Amortisation of SPV debt” by REITs/INVITs will be taxed. At a high level, the changes proposed are extremely friendly.

10 Anti investment proposals.

 Given below is the list of 10 proposals from the government which is actually Anti investment. 

1. Grandfathering introduced
2. Flat LTCG introduced
3. Dividend taxation at tax slab
4. All tax saving sections nullified in new regime
5. Structure Products taxed at STCG retrospectively
6. Insurance proceeds taxed incl ULIP and Traditional
7. Debt Funds getting taxed at STCG
8. NPS is of no use
9. PF already taxed for higher contributions
10. Tax increased on FnO selling by 25%

Marginal Relief Proposal in Finance Bill 2023

It has been proposed to provide marginal relief for taxpayers adopting new tax regime and having income exceeding ₹ 7.00 lakhs.

Tax Amendments Proposed at Lok Sabha

The Finance bill 2023 has been passed in Lok Sabha yesterday with few new proposals which were not there in bill presented on February 1, 2023.  The important points are summarized below for your reference.

 

Maharashtra Government introduces the Bill for amnesty scheme for indirect taxes in the Legislative Assembly

 This Tax Alert summarizes the Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Bill, 2023 introduced in Maharashtra Legislative Assembly.

The Government had proposed an amnesty scheme for various taxes levied before the introduction of Goods and Service Tax (GST) in the State Budget 2023-24 presented on 9 March 2023.

The scheme shall apply to all pending dues under specified state legislations for the period upto 30 June 2017, i.e., before the introduction of GST. Duration for submission of application under the scheme shall commence on 1 May 2023 and end on 14 November 2023. Option for payment in instalments has been made available in cases where arrears are in excess of INR50 lakhs.

The payment of dues under the scheme is summarized below:

Denied duty deferment benefit of Integrated Tax (‘IGST’) and Compensation Cess on import of goods

 In an important update, the Government has proposed amendment to Finance Bill 2023 to deny duty deferment benefit of Integrated Tax (‘IGST’) and Compensation Cess on import of goods.

 

e-Form 10F for claiming treaty benefits

 As you may already know, in order to claim treaty benefits, a non-resident would need to provide Form 10F along with the Tax Residency Certificate (TRC) if all the necessary details were not available in the TRC. However, on July 16, 2022, the Directorate of Income Tax (Systems) introduced a list of various forms that must be filed electronically, including Form 10F.

New Accounting Rule for Private Ltd Co

We wish to bring to your attention the recent government update regarding the maintenance of an audit trail for all transactions by companies starting from 1st April 2023. This new rule has been introduced to enhance transparency in financial reporting and prevent any tampering with accounting entries.

REVISED RETURN – Section 139(5) of Income Tax Act

 This note pertains to the time limit available for revising an Income Tax Return (ITR) that has already been filed within the statutory time limit as specified under Section 139(1) of the Income Tax Act or within the time limit specified for belated return under Section 139(4) of the Act.

Income Tax Department launches AIS app for Taxpayers: Mobile App for AIS

If you are a taxpayer, there is some good news. The Income Tax Department has released a new app called the AIS App for getting Annual Information Statement (AIS). Taxpayers will receive detailed information about each transaction through this app.

FREQUENTLY ASKED QUESTIONS (FAQs) ON FCRA

.1  What is foreign contribution?

 

Ans. As defined in Section 2(1)(h) of FCRA, 2010, "foreign contribution" means the donation, delivery or transfer made by any foreign source, ─

 

Orissa High Court allowed rectification of GSTR-1 return filed for the period September 2017 and March 2018.

 Assessee in the present case had inadvertently reported supplies to a particular recipient as B2C supplies instead of B2B in its GSTR-1 return. This error resulted in recipient holding up the running bill amount of the assessee.

Assessee requested Revenue to permit it to correct its GSTR-1 return, but the same was rejected on the ground that the timeline to apply for rectification was over. Aggrieved, assessee filed a writ petition before the Orissa HC.

International Tax update

·         In 2023 at Portugal, companies must print ATCUD and QR codes on all their invoices. They will need valid codes from the government and tax authority-certified software before they can start generating the invoices.

·         From July 2024 to January 2026, France will implement mandatory B2B e-invoicing, as well as an e-reporting obligation. This mandate impacts all companies operating in France.

· Do you know that:

 

1.     Interest paid under section 234B and 234C of the Income Tax Act is not Tax Expense under AS 22   

2.     Advance paid for import purchases is non-monetary item under AS 11

INTRODUCTION TO FEMA

The Foreign Exchange Management Act, 1999 (FEMA) came into force by an act of Parliament. It was enacted on 29 December 1999. This new Act is in consonance with the frameworks of the World Trade Organisation (WTO). It also paved the way for the Prevention of Money Laundering Act, 2002 which came into effect from July 1, 2005.

Overseas Direct Investment (ODI).

 

What is ODI ?

Overseas Direct Investment or ODI stands for investments, by way of contribution to the capital or subscription to the memorandum of a foreign entity, or by way of purchase of existing shares of a foreign entity, either by market purchase or private placement or through stock exchange but does not include Portfolio Investment. 

Income Tax case laws update.

 

·         Mumbai ITAT held that to opt for concessional tax rate Form 10-1C has to be filed within the due date.

Understand your CTC

 Do you know what lies behind those impressive CTC packages? Let me reveal the truth about inflated salaries and actual take-home pay.

Service of notice by AO by email:

1. Rule 127 of Income Tax Rules require that for communications delivered or transmitted electronically under section 282, the e-mail address to which a notice or summons or requisition or order or any other communication may be delivered or transmitted shall be –

Understanding Section 194O of the Income Tax Act

E-commerce operators facilitating electronic platforms for the sale of goods and services shall comply with Section 194O. This provision mandates the deduction of TDS on payments made to e-commerce sellers. It applies to e-commerce operators with an annual gross turnover of over Rs. 10 crores.

Transfer of Undertakings (Protection of Employment) Regulations

 

The Transfers of Undertakings Directive 2001/23/EC is a European Union law that protects the contracts of employment of people working in businesses that are transferred between owners It replaced and updated the law previously known as the Acquired Rights Directive 77/187/EC

Foreign Investment Reporting and Management System (FIRMS)

The Reserve Bank of India (RBI) has implemented its own Foreign Investment Reporting and Management System (FIRMS) to track foreign investments in the country. The system is an online portal that enables foreign investors to report their investments in compliance with regulations and allows the RBI to monitor and analyze foreign investment data.

Cost & Profit Optimization and Cost reduction.

 What is cost optimization?

Cost optimization is the process of finding the most cost-effective way to accomplish a particular goal or task. It involves identifying ways to reduce costs without sacrificing quality or efficiency. Cost optimization can apply to a wide range of industries and activities, from manufacturing and supply chain management to software development and cloud computing.

UNDERSTAND ZERO COUPON BOND

Generally, bonds are issued at face value and a fixed interest is paid on them. But in case of Zero-Coupon Bonds (ZCB), no interest is paid to the holder. Rather, such bonds are issued at a heavy discount on the face value of the bond. On maturity, the bondholder gets back the face value of the bond. These bonds are therefore, also known as ‘Discount Bonds’. For example: - Suppose Face Value of the bond is Rs. 150 to be matured after 5 years. It is issued at Rs. 100. Thus, the bondholder initially pays Rs. 100. After 5 years, he will get back Rs. 150 

𝘼𝙣𝙣𝙪𝙖𝙡 𝘾𝙤𝙢𝙥𝙡𝙞𝙖𝙣𝙘𝙚 𝘾𝙖𝙡𝙚𝙣𝙙𝙖𝙧 𝙛𝙤𝙧 𝙇𝙇𝙋

 

The Limited Liability Partnership (LLP) is a business structure that merges the characteristics of a conventional partnership with limited liability. The LLP is regulated by the Limited Liability Partnership Act of 2008.

EPFO: PENSION ON HIGHER WAGES:

 

OUR UNDERSTANDING AS PER EPFO NOTIFICATION DT.20.02.2023:👇🏻

Cash Ratio

“Cash is king” still holds. But how do you use cash to analyze your company’s financial health? Consider these seven ratios:

Tax efficient salary structure under old regime.

 

49th GST Council Meeting Recommendations

This is to update you regarding the 49^th GST Council Meeting concluded on February 18, 2023.  Kindly note that the below proposals/ recommendations shall be given effect by way of issuance of relevant notifications/ amendments in the GST law, which could be issued in due course of time.

International Tax update

·         In 2023 at Portugal, companies must print ATCUD and QR codes on all their invoices. They will need valid codes from the government and tax authority-certified software before they can start generating the invoices.

CBDT notifies income-tax return forms (ITR) for tax year 2022-23

 

This Tax Alert summarizes the key amendments made to the Income Tax Return (ITR) forms for tax year 2022-23, vide Notifications No. 4 and 5 of 2023 dated 10 and 14 February 2023 (Notifications) issued by the Central Board of Direct Taxes (CBDT).

GST on RWA

GST is payable only if the aggregate turnover including exempt supplies like property tax and water tax and also third-party goods/ services exempt up to Rs 7500 per month per member exceed Rs 20 Lakhs annually. Even in cases where the monthly receipts are below Rs 7,500 but the annual turnover of the society crosses Rs 20 Lakhs, in such cases GST is payable. Tax is payable at @18% on the entire taxable proceeds. For example, in cases where monthly proceeds exceed Rs 8000, GST is payable on the entire 8000 Rs and not just on 500 Rs as clarified by CBI&C circular dated 22-7-2019. Corpus, contribution to repair fund, and sinking fund collections are viewed as advance for future contingencies which may lead to the rendering of services and hence may be argued as taxable. There are few contrary advance rulings where the view taken is that these do not lead to a supply of services and hence should not be taxable. Many societies contribute heavily to repair funds to be future ready and as such, there is no service involved by way of value creation/addition. Also if we compare this entry on the monthly maintenance bill with others, all the others that are taxable also have associated input tax credit opportunity. Since this is merely a deposit, taxing this would mean taxing non-profit making societies @18 % without any input tax credit which seems unfair. Since the corpus and sinking fund contributions are mandatory in nature, taxing these would mean it is mandatory to pay 18% tax on the members own funds. It would still be acceptable if the interest earned by society from the repair and sinking fund deposit are charged GST instead of the principal.  

Conditions for availing ITC in GST- A small note.

 

1.   Goods or services brought should only be used for further business purposes.
2.   Buyer shall retain such tax invoice, debit note, or other documents as evidence of such payment.
3.   Such tax invoice or debit note is filed by the supplier in Form GSTR-1, and it appears in the Buyer’s GSTR-2B form.
4.   The goods or services must have been delivered to the buyer.
5.   The buyer must furnish the GST returns in Form GSTR-3B.
6.   Where the goods are received in lots or installments, ITC will be allowed to be availed when the last lot or installment is received.
7.   The buyer must pay towards the supply of goods and/or services within 180 days from the invoice date. If they fail to do so, then the ITC already claimed will be added back to output tax liability and interest must be paid on such tax. ITC claim will be reinstated once the payment is made to the supplier.
8.   If depreciation has been claimed on the tax portion of a capital goods (Assets) purchase, no ITC will be permitted.
9.   Input tax credit can be claimed only before 30th November of the following year or before the filing of Annual GST returns whichever is earlier. That means to avail of the Input tax credit for Financial Year 2022-23, ITC for this year can only be claimed on or before 30th November 2023.
10. If Goods are lost or stolen or confiscated after the purchase, then ITC on such inward supply of goods are not eligible for an Input tax credit.

In house tax department – Mission & Vision.

The mission of an in-house tax department is to ensure compliance with all tax laws and regulations, minimize tax liability, and identify and manage tax-related risks.

The vision of an in-house tax department is to become a trusted partner to other departments within the company and provide strategic tax planning guidance to help the company achieve its business goals.

CBDT notifies Centralised Processing of Equalisation Levy Statement Scheme, 2023

 The Finance Act, 2016 introduced Equalisation Levy (EL) at the rate of 6 per cent on the amount of consideration for online advertisement, any provision for digital advertising space or any other facility or service for the purpose of online advertisement with effect from 1 April 2016. This EL is applicable on the consideration received by a non-resident, from a person resident in India and carrying on business or profession or a non-resident having a Permanent Establishment in India.

The Finance Act, 2020 expanded the scope of the EL and introduced a 2 per cent levy on the amount of consideration received or receivable by an e-commerce operator from e-commerce supply or services. An ‘e-commerce operator’ is defined to mean a non-resident who owns, operates or manages a digital or electronic facility or platform for the online sale of goods or online provision of services or both.

Section 167 of the Finance Act, 2016 provides that the assessee or e-commerce operator should furnish a statement with the Assessing Officer. Further, Section 168 provides for a processing of such statement. However, the Scheme for processing of such statement was awaited.

Recently, the Central Board of Direct Taxes has notified the Centralised Processing of Equalisation Levy Statement Scheme, 2023 (the Scheme). The Scheme shall come into force on the date of its publication in the Official Gazette i.e. 7 February 2023.

India Budget 2023 first cut

Personal Tax

Ø  No change in tax rate under the old regime.

Ø  Receipts from Life insurance are taxable if the gross annual premium payment exceeds Rs. 5 Lakhs. The net amount is taxable under the head Income from other sources for new policies taken after March 23.

Ø  Limit of Leave encashment of Rs. 3 Lakhs increase to Rs. 25 Lakhs. (to  be verified not available in the Memorandum but was there in the budget speech)

Understand Deep Discount Bond.

Deep discount bonds, as the name suggests, are bonds that are sold at a significant discount to their face value. However, they also offer lower interest rates compared to other types of bonds. In this article, we will explain the concept of deep discount bonds, provide examples, and discuss their advantages and calculation methods.

𝐓𝐨𝐩 𝐬𝐢𝐠𝐧𝐬 𝐨𝐟 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐬𝐭𝐚𝐭𝐞𝐦𝐞𝐧𝐭 𝐦𝐚𝐧𝐢𝐩𝐮𝐥𝐚𝐭𝐢𝐨𝐧

Financial statements are reports that provide information about a company's financial performance and position. The three main financial statements are the balance sheet, income statement, and cash flow statement. The balance sheet shows a company's assets, liabilities, and equity at a specific point in time. The income statement shows a company's revenue, expenses, and profit over a specific period. The cash flow statement shows a company's cash inflows and outflows over a specific period. Together, these statements provide a comprehensive picture of a company's financial situation and can be used to analyze its performance and make informed decisions about investing in the company. It is not necessary to be a financial market analyst to identify signs of manipulation in companies' financial statements of companies.

Income Escaping Assessment – The Legal Analysis

 There are various reasons why litigation arises between the assessees and the income tax department including TDS, disallowance of certain expenditures, exemptions, and deductions, etc. One of the major reasons for litigations is when the department finds a certain income that has escaped assessment and therefore proceeds to tax the same. This is known as income escaping assessment or Reassessment under section 147 of the income tax act & Section 148. Here, we have covered everything regarding income escaping assessment, what is covered in this assessment and why it is a major contributor in litigations.

How To Incorporate A USA Company As A Founder In India?

Indian startups seem to prefer Delaware for their business. Not only does register your Delaware corporation from India gives access to venture capital firms and startup investors, but you will also get tax benefits. Delaware has no state sales tax, and the state’s franchise tax for small US businesses is also less. Additionally, the state also allows non-residents to pay no separate corporate income tax.

One has to follow six steps in order to have a USA Company Registration from India:

Choose the right entity type for your business. As Investors highly prefer C corporations, most Indian companies choose this type.

Decide the state in which you want to register your company. Delaware is the most preferred state and is the home to the majority of US tech companies. 70% of Fortune 1000 companies are registered in Delaware.

File to incorporate.

The next step is to get an employer identification number (EIN) from the Internal Revenue Service (IRS).

Registering with the Internal Revenue Service also sets your company to pay taxes. Also, you need an EIN to open a US bank account.

Once you have an EIN, open a US bank account, which is essential for doing business in the US.
In the state of Delaware, you are required to file annual reports every year. So, keep your company in a sound situation by filing reports.

CHAT GPT - how to save tax in India

 

1. Invest in tax-saving investments such as Public Provident Fund (PPF), National Savings Certificate (NSC), Equity-Linked Savings Scheme (ELSS), and Tax-Saving Fixed Deposits (FD).

2. Utilize deductions and exemptions available under Section 80C of the Income Tax Act, such as tuition fee for children, principal repayment of home loan, and contributions to pension plans.

3. Take advantage of deductions available under Section 80D for health insurance premiums, and Section 80E for interest paid on education loans.

4. Consider renting out a property and claim deductions for interest on a housing loan and repairs and maintenance expenses.

5. Use exemptions available for long-term capital gains on sale of property and equity shares.

6. Take advantage of tax benefits available for charitable donations under section 80G.

7. Keep records of all investments and expenses to claim deductions and exemptions at the time of filing taxes.

8. Consult with a tax professional or financial advisor for personalized advice on tax-saving strategies.

It's important to note that the tax laws and regulations in India are subject to change, and it's always a good idea to keep yourself updated with the latest tax laws and regulations

Social Stock Exchange

 

A Social Stock Exchange allows the listing of a Non-Profit Organization on stock exchanges that provide an alternative fund-raising structure.   As per the draft of the SEBI report, a Social Stock Exchange may be helpful in rebuilding the livelihoods of people who are affected during the COVID-19 pandemic. According to experts SSEs will aim at unlocking large pools of social capital and encourage a mixed financial structure so that conventional capital can partner with social capital to meet the serious challenges of COVID-19.

IFRS 2: SHARE-BASED PAYMENT TRANSACTIONS

Grant of shares or share options to employees and directors is a common feature with most companies. Besides, companies may sometimes issue share options to creditors as well. Transactions, where is granting of shares or share options, may generically be referred to as “share-based payment transactions”. These transactions mostly involve the company receiving employment services, directorial services, or other goods or services, and the company in turn settling the supply of goods or services in the form of shares or share warrants. The shares are mostly equities of the company (note that the meaning of “equity” under accounting standards is not the same as the legal meaning of equity).

Understand Section 338(h)(10) of the federal tax code.

 

In simple terms, a 338(h)(10) is a tax election for a qualified stock purchase (QSP), which recharacterizes a stock purchase as an asset purchase for federal tax purposes. It remains a stock purchase for all other legal purposes, such as contracts and licensing 

 

Key notes on Circular No. 183/15/2022-GST dated 27 December 2022 on GSTR-2A & GSTR-3B

 

The CBIC in the captioned circular  issued a clarification with respect to the following scenarios to deal with differences in Input Tax Credit (ITC) availed in FORM GSTR-3B vis-à-vis as per FORM GSTR-2A for FY 2017-18 and FY 2018-19.

Taxation of Online Gaming

Let us understand the online gaming ecosystem in India with reference to the applicability of the Indirect tax and direct tax provisions in India.

·         There are two types of gaming

Is Form 10F is mandatory?

While there has been a recent buzz in the industry over the government's move of mandating the furnishing of Form 10F electronically, many people are unaware of the basic fact that the aforesaid form [as per section 90(5)] is only required to be furnished if the Tax Residency Certificate (TRC) furnished by the Non-Resident payee in accordance with section 90(4), does not contain certain information as prescribed in Rule 21AB(1). This is also stated in rule 21AB(2).

48th GST Council meeting

 Given below the update with respect to relevant announcements made post the 48th GST Council Meeting held on 17 December 2022:

 

History of Global Transfer Pricing

 
The First World War ended way back in 1918/19. It was the first time when the different nations in the world collaborated to form the “League of Nations” in order to maintain peace and security, and take decisions in the matter of International Affairs.

UAE adopts Transfer Pricing Regulations

 

A corporate tax regime without transfer pricing provisions would be spineless. Transfer pricing is detailed and mention in the Federal Decree released on 9 December 2022. While we are undertaking detailed research on transfer pricing law in the UAE, here is our first take on the transfer pricing law in the UAE.

Compute Customer Acquisition Cost (CAC) and Lifetime Value (LTV)

Calculating Customer Lifetime Value (LTV):

- Suppose a company’s ARR (Annual Recurring Revenue)= $500K
- Total number of customers= 2500
- Average Revenue Per Customer= $500K/ 2500= $200

Know about “Form ITR-A

 

1. ITR-A is a form provided to furnish a modified return by a successor company to a business reorganization for an assessment year.

2. Where businesses go through a reorganization the successor entity, is required to file modified returns for the period between the date of effectivity of the order and the date of issuance of the final order of the competent authority. Form ITR-A is the prescribed form by the Income Tax Department for filing such a return.

3. When two or more business goes under remodeling, reconstruction, amalgamation, or merger the resulting business or entity is known as the successor entity, and the businesses going under reorganization are known as the predecessor entity.

4. The prescribed form should be furnished within six months from the end of the month in which said order was issued.

5. The ITR-6 (applicable for companies) has been modified to include information contained in FORM ITR-A.

6. In Appendix II, in Form ITR-6- PART A-GEN, entries of the serial number (A19)(a)(i), have been substituted, for every assessment year commencing on April 01, 2022, or any, earlier assessment year.

(Rule 12AD of the Income Tax Rules)

Comparing Indian GST with European VAT

 

It has been more than 5 years since GST has been introduced in India and with the passage of time, the process of GST has stabilized in the country and the government feels proud of the success of GST implementation in the country.  Being tax head of an MNC, I am being exposed to the GST or VAT process of other countries, especially  European countries, and in this article tries to compare the indirect tax process of both countries from my own experience.

GST input credit on Motor vehicles.

ITC is blocked on motor vehicles having seating capacity ≤ 13 persons (including the driver) used for the transportation of persons. Further, ITC is also blocked on certain services relating to motor vehicles namely, insurance, servicing, and repair and maintenance.

What would be the treatment of 𝐭𝐚𝐱𝐞𝐬 𝐩𝐚𝐢𝐝 𝐢𝐧 𝐟𝐨𝐫𝐞𝐢𝐠𝐧 𝐜𝐨𝐮𝐧𝐭𝐫𝐢𝐞𝐬 𝐟𝐨𝐫 𝐰𝐡𝐢𝐜𝐡 𝐜𝐫𝐞𝐝𝐢𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐢𝐧 𝐈𝐧𝐝𝐢𝐚?

Indian Income Tax Act does not allow refund in such cases but based on various judgments 𝐭𝐡𝐞 𝐩𝐨𝐫𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐚𝐱 𝐟𝐨𝐫 𝐰𝐡𝐢𝐜𝐡 𝐜𝐫𝐞𝐝𝐢𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐜𝐚𝐧 𝐛𝐞 𝐜𝐥𝐚𝐢𝐦𝐞𝐝 𝐚𝐬 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧. For example, tax paid in say UK is Rs.1000/- whereas credit is only available for Rs.600/-, in this case Rs.400/- can be claimed as business deduction.
Various judgments in support of this view:
𝑉𝑖𝑟𝑚𝑎𝑡𝑖 𝑆𝑜𝑓𝑡𝑤𝑎𝑟𝑒 𝑎𝑛𝑑 𝑇𝑒𝑙𝑒𝑐𝑜𝑚𝑚𝑢𝑛𝑖𝑐𝑎𝑡𝑖𝑜𝑛 𝐿𝑡𝑑. 𝑣𝑠. 𝐷𝐶𝐼𝑇 [𝐼𝑇𝐴 𝑁𝑜.1826/𝐴𝐻𝐷/2019]
𝐵𝑎𝑛𝑘 𝑜𝑓 𝐼𝑛𝑑𝑖𝑎 𝑣𝑠 𝐴𝐶𝐼𝑇 [𝐼𝑇𝐴 𝑁𝑜.869/𝑀𝑢𝑚/2018]
𝑅𝑒𝑙𝑖𝑎𝑛𝑐𝑒 𝐼𝑛𝑓𝑟𝑎𝑠𝑡𝑟𝑢𝑐𝑡𝑢𝑟𝑒 𝐿𝑡𝑑. 𝑣𝑠. 𝐶𝐼𝑇 [𝐼𝑇𝑅 75 𝑜𝑓 1998, 𝐵𝑜𝑚𝑏𝑎𝑦 𝐻𝐶]

Understand foreign tax credit for USA ex-pats.

 

One of the most common problems US ex-pats face is double taxation—paying taxes twice on the same income. Fortunately, the IRS offers multiple tax credits and deductions to help expats avoid this costly burden. One example is the Foreign Tax Credit (Form 1116). Using this credit, many Americans living abroad are able to erase their US tax debt entirely.

Comparison of buy back with dividend

 

Section 94B of the Income-tax Act, 1961 – Unanswered Questions.

Section 94B of the Act was introduced by the Finance Act, 2017 to give effect to 'OECD BEPS Action Plan 4 - Limiting Base Erosion Involving Interest Deductions and Other Financial Payments.

Transfer Pricing Master File Form 3CEAA – Practical considerations

Master File (MF) in Form3CEAA to be e-filed by Indian entities of MNE Group by the due date of filing IT return i.e., 30 November. While Part A of Form has no threshold, Part B to be filed when a) consolidated group revenue >Rs 500 cr & b) aggregate value of international transactions >Rs 50 cr, or aggregate value of IP transactions >Rs 10 cr.

ITC on residential dwelling occupied by the employee is allowed to the employer?

With the withdrawal of the GST exemption on the services by way of renting of residential dwelling for use as a residence when provided to a registered person (RP), an important question that arises is whether the RP is eligible to claim ITC of the GST applicable therein if the residential dwelling is occupied by his employees.

UAE Corporate Tax wef. 01st June 2023

With effective from 01st June 2023, the new corporate tax will apply to businesses across all Emirates, with an exception for the extraction of natural resources, which will remain subject to Emirate level corporate taxation. Foreign entities and individuals will be subject to corporate tax only if they conduct a trade or business in the UAE in an ongoing or regular manner. It is important that businesses evaluate the impact of the introduction of UAE CT early on and proactively plan for a smooth implementation.  Examples:

What is GST Notice.

 Adjudication is adversarial, and Revenue is not willing to backdown from the 'view' canvassed merely because taxpayer has declined to subscribe to it. Revenue will want to exhaust every remedy available in law to 'save the demand'. Justifiably so.

What is Rule 132 of the Income Tax Rules?

 

1. Rule 132 is a beneficial clause allowing assessees to comply with the provision of Section 155 which allows Assessing Officers to re-compute the total income for such previous years in which the assessee would have claimed deduction of surcharge or cess subject to be disallowed u/s 40(a)(ii).