a. Domestic Company
The rates of income-tax in the case of companies are specified
in Paragraph E of Part III of the First Schedule to the Bill. These rates are
the same as those specified for the financial year 2014-15 i.e. 30% of
taxable income.
Surcharge at
the rate of seven per cent shall be levied in case of a
domestic company if the total income of the domestic company exceeds
one crore rupees but does not exceed ten crore rupees. The surcharge
at the rate of twelve percent shall be levied if the total income of the domestic
company exceeds ten crore rupees. In case of companies other than
domestic companies, the existing surcharge of two per cent. shall continue to
be levied if the total income exceeds one crore rupees but does not exceed ten
crore rupees. The surcharge at the rate of five percent shall continue to be
levied if the total income of the company other than domestic company exceeds
ten crore rupees.
However, the total amount payable as income-tax and surcharge on
total income exceeding one crore rupees but not exceeding ten crore rupees,
shall not exceed the total amount payable as income-tax on a total income of
one crore rupees, by more than the amount of income that exceeds one crore
rupees. The total amount payable as income-tax and surcharge on total income
exceeding ten crore rupees, shall not exceed the total amount payable as
income-tax and surcharge on a total income of ten crore rupees, by more than
the amount of income that exceeds ten crore rupees.
In other cases (including sections 115-O, 115QA, 115R or 115TA)
the surcharge shall be levied at the rate of twelve percent.
For financial year 2015-2016, additional surcharge called the
“Education Cess on income-tax” and “Secondary and Higher Education Cess on
income-tax” shall continue to be levied at the rate of two per cent. and one
per cent. respectively, on the amount of tax computed, inclusive of surcharge
(wherever applicable), in all cases. No marginal relief shall be available in
respect of such Cess.
b. Normal
tax rates applicable to a foreign company
A foreign company is
taxed at a flat rate of 40%. Apart from tax @ 40%, Education Cess is levied @
2% of income-tax and Secondary and higher Education Cess is levied @ 1% of
income-tax.
Surcharge : In addition to tax at above rate, surcharge is
levied @ 2% on the amount of income-tax if net income exceeds Rs. 1 crore but
does not exceed Rs. 10 crore and @ 5% on the amount of income-tax if net income
exceeds Rs. 10 crore. In a case where surcharge is levied, EC of 2% and SHEC of
1% will be levied on the amount of income-tax plus surcharge.
However, marginal
relief is available from surcharge in such a manner that in the case of a
foreign company whose net income exceeds Rs. 1 crore but does not exceed Rs. 10
crore the amount payable as income-tax and surcharge shall not exceed the total
amount payable as income-tax on total income of Rs. 1 crore by more than the
amount of income that exceeds Rs. 1 crore.
In case of a foreign
company whose net income exceeds Rs. 10 crore, marginal relief is available
from surcharge in such a manner that the amount payable as income-tax and
surcharge shall not exceed the total amount payable as income-tax and surcharge
on total income of Rs. 10 crore by more than the amount of income that exceeds
Rs. 10 crore.
MAT : In
the case of a corporate taxpayer to whom the provisions of Minimum Alternate
Tax (MAT) applies, tax payable cannot be less than 18.5% (+SC+EC+SHEC) of “Book
profit” as per section 1 15JB.
Income Tax Rate Chart
In case of Corporates for Financial year 2015-16
|
SI.No.
|
Particulars
|
Tax(%)
|
Surcharge(%)
|
E. Cess(%)
|
SHE. Cess (%)
|
Effective Tax(%)
|
|
1
|
Domestic companies
(with total income less than 1 Cr.)
|
30
|
–
|
2
|
1
|
30.90
|
|
2
|
Domestic companies
(with total income more than1 cr. but less than 10 Cr.)
|
30
|
7*
|
2
|
1
|
33.063
|
|
3
|
Other domestic
companies
|
30
|
12#
|
2
|
1
|
34.608
|
|
4
|
Foreign companies
(with total income less than 1 Cr.)
|
40
|
–
|
2
|
1
|
41.20
|
|
5
|
Foreign companies
(with total income more than
|
40
|
2
|
2
|
1
|
42.024
|
|
1 cr. but less than
10 Cr.)
|
||||||
|
6
|
Other foreign
companies
|
40
|
5
|
2
|
1
|
43.26
|
* Surcharge has been
increased from 5% to 7%.
# Surcharge has been
increased from 10% to 12%.
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