Minimum Tax

[Information Consultant]

Can a company fall under minimum tax regime shows a total turnover in col 36 (e) and Annex B col 8 or shows a total turn over in col 8 of main page " Other Revenue ---- " and claim expenses against total turnover ?

Can a company fall under Min tax regime adjust advance tax paid on utility,cash withdrawal,mobile ?

[student_of_law]

The columns you have referred seem to be irrelevant or I could not understand that.

With respect to second paragraph of your question, section 168 of the ITO, 2001, lays down general rule that tax deducted at source are adjustable against tax liability. The only exception is that tax deducted at source is not adjustable against final tax liability. Section 168 does not say that tax deducted at source is not adjustable against minimum tax liability. Hence they are adjustable.

This interpretation is also supported from the FBR return.
Suppose a company has made 0 profit.
While its turnover is 1 lac.
Tax credit is also zero
Tax deducted on cash withdrawal is 100
Now while filing IT-1, Column 161 will be zero as well as column 162. Column 163, 164, 165 will also be zero.
Column 166 will be [1%of turnover - Column 166 - col.162, 163,165 ]
Column 166 will be 1% of 1 lac -zero = 1,000
Column 167 will also be Rs.1,000.
Column 168 will show surcharge 15% x3.5/12x10,000 = 40 (round figure)
Column 169 will be 1040
Columns 170 shall show tax deducted on cash withdrawal that is Rs.100

Tax payable under col 171 is 1040 - 100 = 940

Hence the pattern of prescribed format of return also shows that tax deducted at source, not being final tax liability, are adjustable against minimum tax liability.

[Information Consultant]

Thanks
One more thing where should we show our receipts against sec 153 ( min tax ) .Should we mention it in Annex B or show proper receipt and expenses,Calculate tax liability on the basis of this?
For eg

our recipts u/s 153 Rs 100000
cost of receipts 30000
Tax deducted 6 % 6000 min tax
Tax on cash with drawal 200

[student_of_law]

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Information Consultant</i>
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our recipts u/s 153 Rs 100000
cost of receipts 30000
Tax deducted 6 % 6000 min tax
Tax on cash with drawal 200

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

You would show your receipts (including MTR) and expenses in the similar way as if there is no minimum tax. When you come to Column 164 you will write proportionate normal tax on revenue from services subject to MTR. You will also write 6% minimum tax. Then you will compare the two and give effect to the higher value in Col 167. Return is self guiding and explanatory, just read the columns thoroughly