What Is Mat Tax

Companies find various loop holes to avoid paying income tax by using several exemptions.

What is mat tax.

My alabama taxes my alabama taxes is currently unavailable. My alabama taxes sign up you may now file your individual income tax return at my alabama taxes mat in order to file your return you will need a mat username and have access to your individual income tax account. Companies try to minimise giving taxes by taking advantage of depreciation deductions exemptions etc from the government. If you continue to receive this message please contact mat support.

8 40 000 will amount to rs. The tax liability of a company will be higher of. We apologize for the inconvenience. Mat is a way of making companies pay a minimum amount of tax.

As per the concept of mat the tax liability of a company will be higher of the following two. The concept of mat was introduced to target those companies that make huge profits and pay the dividend to their shareholders but pay no minimal tax under the normal provisions of the income tax act by taking advantage of the various deductions and exemptions allowed under the act. Mat a brief introduction. Minimum alternate tax mat is a tax effectively introduced in india by the finance act of 1987 vide section 115j of the income tax act 1961 it act to facilitate the taxation of zero tax companies i e those companies which show zero or negligible income to avoid tax under mat such companies are made liable to pay to the government by deeming a certain percentage of their book.

I normal tax liability or ii mat. Normal tax rate applicable to an indian company is 30 plus cess and surcharge as applicable. Tax 30 on rs. Later it was withdrawn by the finance act 1990 but reintroduced again from 1 april 1997.

Minimum alternative tax is payable under the income tax act. So the government imposes a minimum alternate tax or mat as an advance. Mat or minimum alternate tax is a provision in direct tax laws to limit tax exemptions availed by companies so that they mandatorily pay a minimum amount of tax to the government. It was first introduced by the finance act 1987 and made effective from ay 1988 89.

As per section 115jb all companies are required to pay corporate tax at least equal to the higher of the following. Book profit of the company is rs. Since october 1 2013 alabama retailers have been able to file and pay all city county sales use and rental taxes in mat the one spot to file. Mat is a tax levied under section 115jb of the income tax act 1961.