Section 115WM of the Income-tax Act, 1961 – Income-tax on fringe benefits – Chapter XII-H not to apply after a certain date – Adjustment of advance tax in respect of fringe benefits for assessment year 2010-11 against advance tax
Circular No. 2/2010, dated 29-1-2010
The Finance Act, 2005 introduced a levy namely Fringe Benefit Tax (FBT) on the value of certain fringe benefits as contained in Chapter XII H (Section 115W to 115WI) of Income Tax Act, 1961. By the Finance (No. 2) Act, 2009 a new Section 115WM was inserted to abolish the FBT with effect from Assessment Year (A.Y.) 2010-11. Consequently, benefits given to employees are taxed as perquisites in the hands of employees in terms of amendment to Clause 2 of Section 17 of Income Tax Act. 1961. However, during the current Financial Year 2009-10 some assessees have paid advance tax in respect of fringe benefits for Assessment Year 2010-11. In such cases the Board has decided that any installment of advance tax paid in respect of fringe benefit for A.Y. 2010-11 shall be treated as Advance Tax paid by assessee concerned for A.Y. 2010-11. The assessee can adjust such sum against its advance tax obligation in respect of income for A.Y. 2010-11 or in case of loss to claim such payment as refund as advance tax paid in A.Y. 2010-11.
2. This circular may be brought to the notice of all officers in the field for compliance.
About taxworry
Please help me in this
1.If any Company paid advance tax in the F Y year 2005-06 and in 2005-06 company make loss. can we Claim refund of this Advance tax after the assessement.
2. Please tell me that if we received refund from income tax department for the Advance tax paid by us, what is the entry to be passed in the books of accounts, if in the year of payment there will be loss in the business. and no provission is made