CBDT extends date for domestic cos to gain 22% tax benefit under form 10-IC

Oct 24, 2023

Synopsis
The Central Board of Direct Taxes (CBDT) has granted an extension for filing Form 10-IC, which is required for domestic companies opting to pay tax at a concessional rate of 22%. This provision was introduced in the Income Tax Act from the financial year 2019-20. Eligible companies can now file Form 10-IC for the Assessment Year 2021-2022 by January 31, 2024, to avail the 22% tax benefit.

The Central Board of Direct Taxes (CBDT) on Monday has allowed the delay in filing of Form 10-IC which is required to be filed only if a domestic company chooses to pay tax at concessional rate of 22 per cent under Section 115BAA of the Income Tax Act, 1961.

It is to be noted this section, which was added in the I-T Act with effect from FY 2019-20, states that subject to certain specific criteria, every domestic firm has the option to pay income tax at the rate of 22 per cent (effective tax rate: 25.168 per cent with surcharge and cess).

Pertaining to this, in a relief to eligible companies, the government agency has allowed them to file form 10-IC for the Assessment Year (AY) 2021-2022 on or before January 31, 2024 to avail 22 per cent tax benefit.

"Form 10-IC is filed electronically on or before 31.01.2024 or 3 months from the end of the month in which Circular is issued, whichever is later," the CBDT circular read.

However, as part of its conditions, the department demands that the Return of Income for the relevant AY should be filed on or before the due date.

Having failed to file this form, the companies were denied the said benefit. In due course, the Income Tax department had issued notice to these companies to pay 30 per cent tax with Minimum Alternate Tax (MAT).

[The Economic Times]