MAT

Q.1
A. Y. 2015-16 Rs. (Lakhs)
XYZ Limited has reported the following for the year ended March 31, 2015
a. Loss before Depreciation 1000
b. Depreciation as per Companies Act (Books) 15
c. Depreciation as per Income Tax Act 10

A. Y. 2016-17
The relevant figures for the year ended March 31, 2016 (A.Y. 2016-17) are
a. Profit as per Profit & Loss A/c (before Depreciation) 1053
b. Depreciation as per Companies Act 11
c. Depreciation as per Income Tax Act 8
d. Inter corporate dividend- Exempt from tax 50
d. Inter corporate dividend- Interest paid on borrowings 15

A. Y. 2017-18
Let us assume the position for the financial year 2016-17 (A.Y. 2017-18) as follows-
a. Profit as per Profit & Loss A/c (before depreciation) 800
b. Depreciation- Companies Act 10
c. Depreciation as per I.T. Act 7

Assume MAT rate = 20% and Normal rate = 30%

(Ignore surcharge and HECess)
Rs. (Lakhs)

Profit -1000
Depreciation -10 Brought forward loss and depreciation
-1010

Book Profit Income Tax

1053 1053
-11 Depreciation -8
-50 Dividend -50
15 Interest - Exempt income 15
-15 Nett. 1010
992 Less: Loss in AY 2015-16 -1000
MAT Credit --> 198.4 Less: Depreciation in AY 2 -10
Taxabable income 0

800 Profit as per P&L 800

-10 Less: depreciation as per IT -7
790 Taxable Income 793
158 Tax at 30% 237.9 <-- I should be paying 237.9
MAT Credit Utilized 79.9
Tax paid through bank 158

MAT Credit c/f 118.5

rward loss and depreciation