In the case of domestic companies, there is no change in the tax rates proposed, in respect of FY 2022-23/ AY 2023-24, as per the Finance Bill 2022. Therefore the tax rates for domestic companies shall remain the same, as were specified for the FY 2021-22/ AY 2022-23 in the Finance Act 2021.
It may be noted that a domestic Company means an Indian company or any other company which, has made the prescribed arrangements for the declaration and payment within India of the dividends (including dividends on preference shares) out of its income liable to income-tax under the Income-tax Act.
Proposed Income Tax Rates for Domestic Companies (FY 2022-23/ AY 2023-24)
Same as applicable for FY 2021-22/ AY 2022-23.
Income Tax Rates for Domestic Companies (FY 2021-22/ AY 2022-23)
Income Tax Rates for Domestic Companies/ Indian Companies in respect of FY 2021-22/ AY 2022-23, as per Finance Act 2021, remained the same as were applicable in respect of FY 2020-21/ AY 2021-22, as per the Finance Act, 2020, i.e. no change from last year.
Income Tax Rates for Domestic Companies (FY 2020-21/ AY 2021-22)
Income Tax Rates for Domestic Companies/ Indian Companies in respect of FY 2020-21/ AY 2021-22, as per Finance Act 2020, are 25% in case the turnover is upto Rs. 400 crore* and 30% in case the turnover is above Rs. 400 crore, with concessional rates for companies covered under Sections 115BA, 115BAA and 115BAB:
|Categories/ Conditions for differential tax rates||Income Tax Rate|
|If turnover or gross receipts of a domestic company, does not exceed Rs. 400 crores, in the previous financial year*||25%|
|Domestic companies covered u/s 115BA||25%|
|Domestic companies covered u/s 115BAA||22%|
|Domestic companies covered u/s 115BAB||15%|
|In the case of all other domestic companies||30%|
In addition, Surcharge, Health & Education Cess (HEC) and Minimum Alternate Tax (MAT) provisions, shall be applicable in the case of Domestic Companies, as under:
The income tax liability so computed (including u/s 111A, 112 or 112A), domestic company shall be liable to surcharge @ 7% where total income is above Rs. 1 crore but is upto Rs. 10 crore and @ 12% where total income exceeds Rs. 10 crore. However, in the case of companies covered u/s 115BAA and 115BAB, surcharge @ 10% shall be applicable. In all cases, surcharge amount is subject to provisions relating to marginal relief, if applicable.
The aggregate amount of Income Tax and Surcharge, shall be subject to Health & Education Cess (HEC) @ 4%, in all cases.
Where normal tax liability of the Domestic Company is less than 15% of the book profits, the Minimum Alternate Tax (MAT) shall be applicable @ 15% of book profits, except in the case of companies covered u/s 115BA. Besides, surcharge and Health and Education cess shall be applicable, as above.
MAT rate shall be 9% in the case of a Company, which is a unit of an IFSC and derives its income solely in convertible foreign exchange (CFE).
Domestic companies opting for concessional taxation rates u/s 115BAA/ 115BAB are exempt from MAT, however these companies are not eligible to get certain deductions, i.e. u/s 80IA, 80IAB, 80IAC, 80IB, etc. except u/s 80JJAA and 80M.
* for FY 2020-21/ AY 2021-22: total turnover or the gross receipt in the FY 2017-18
* for FY 2021-22/ AY 2022-23: total turnover or the gross receipt in the FY 2018-19
* for FY 2022-23/ AY 2023-24: total turnover or the gross receipt in the FY 2019-20
|Income Tax Slabs/ Rates:||Income Tax Cess, Surcharge & Rebate|
|Resident Individuals||Education Cess Rates|
|NRIs/ HUFs/ AOP/ BOI/ AJP||Surcharge Rates|
|Partnership Firms and LLPs||Marginal Relief from Surcharge|
|Domestic Companies||Rebate u/s 87A for Individuals|