CBDT Extends Deadline Till June 30 For Corporates to Claim Lower Tax Rate | Details Inside

To avail lower tax rate, the business establishments have to opt for it by submitting form 10-IC in electronic form before filing the tax returns.

New Delhi: The Central Board of Direct Taxes (CBDT), the tax wing of the Income Tax Department, on Friday extended the last date to businesses and corporates to submit Form 10-IC, an important form required to avail a lower corporate tax rate of 22%. The CBDT has given extra time till end of June 30 to submit the form. To avail this lower tax rate, the business establishments have to opt for it by submitting form 10-IC in electronic form before filing the tax returns.

For the income in FY20, the tax returns were to be filed in the assessment year starting 1 April 2020 (AY2020-21). The option once exercised, will apply for subsequent years as well.

However, many business establishments which claimed the benefit of lower rate in their tax returns have not filed the specified form separately in this regard, leading to hardships.

In a statement, the CBDT said that failure to submit this form would lead to denial of the concessional 22% tax rate and in view of the representations received for relief, extra time is being given.

“Representations have been received by the Board stating that form 10 IC could not be filed along with the return of income for the assessment year 2020-21, which was the first year of filing of this form. It has been requested that the delay in filing of form 10 IC may be condoned,” CBDT said in the circular.

The I-T Department had in 2019 introduced forms 10-IC and 10-ID in order to allow corporates to avail a lower tax rate, applicable for income earned in FY20 onwards. However, the new deadline to submit the form is June 30, the CBDT said in a statement.

To avail these lower rates, the corporates need to file forms 10-IC and 10-ID, whichever applicable, before the last date.

As per Section115BAA, the domestic firms can opt for concessional income tax, along with surcharge and cess, if they choose to forego certain specified deductions and incentives. If a business has opted for concessional tax rates once, it will need to apply to subsequent assessment years and cannot be withdrawn.

The CBDT said with a view to avoid genuine hardship to the domestic companies in exercising the option of the lower tax rate, it has directed that the delay in filing this form for 2020-21 assessment year is condoned in cases where certain conditions are met.

“The conditions say that the business that seeks this rate should have filed tax returns for assessment year 2020-21 on or before the due date and have opted for the benefit in the return form and form 10 IC is filed on or before 30 June 2022,” the CBDT said.