union budget 2011 highlights

Download Union Budget 2011   Highlights

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  • 1. UNION BUDGET 2011 - Highlights KUMBHAT & CO., S.BHANSALI & ASSOCIATES ISHITA ADVISORY SERVICES P LTD02-03-2011 KUMBHAT & CO., 1
  • 2. DIRECT TAX Increase in Limits of Basic Exemption from Rs.1.60 lacs to Rs.1.80 lacs for Individuals (Men) New Slabs for Asst. Year 2012-13 Upto Rs.180000 - Nil Rs.180001 lacs to Rs.5.00 lacs 10% Rs. 500001 lacs to Rs.8.00 lacs 20% Rs. 800000 lacs and above 30%02-03-2011 KUMBHAT & CO., 2
  • 3. DIRECT TAX For Women Senior Super Senior For Citizen > 60 > 80 years Individuals years Basic Rs.190000 Rs.250000 Rs.500000 Rs.180000 Exemption _ upto Tax NIL Slab Tax @ Rs.190001 Rs.250001 - Rs.190001 10% Rs.500000 Rs.500000 Rs.500000 Slab Tax @ Rs.500001 - Rs.500001 - Rs.500001- Rs.500001 - 20% 800000 800000 Rs.800000 800000 Slab Tax 30% > Rs. 800000 > Rs. 800000 > Rs. 800000 > Rs. 80000002-03-2011 KUMBHAT & CO., 3
  • 4. DIRECT TAX Surcharge on Companies @ 5% reduced from 7.5% On Income > Rs. 1.00 crore Minimum Alternate Tax (MAT) increased from 18% to 18.5% - LLP also liable to AMT (MAT) Charitable Purpose General Public Utility limits raised from Rs.10 lacs to Rs.25 lacs02-03-2011 KUMBHAT & CO., 4
  • 5. DIRECT TAX Companies in SEZ to pay MAT w.e.f. A Y . 2012-13 & DDT w.e.f. 1.6.2011 Direct Tax Code may be brought in with effect from 1.4.2012 80CCD NEW PENSION SYSTEM Contribution exempt upto 10% of Salary or Gross Total Income apart from Rs.1.00 lac under 80C/80CCC/80CCD 80CCF Extended to A Y 2012-1302-03-2011 KUMBHAT & CO., 5
  • 6. DIRECT TAX Transfer Pricing Finance Bill proposes to vary the variation % based on industry and business excigiencies Proviso to Sec 92C(2) to compute the ALP TPO can now compute the ALP of transactions not referred to him by assessing officer TPO can conduct Survey u/s 133A Report of auditor u/s 92E to be filed by 30th November to base the comparable data of the current year instead of Previous year data w.e.f 1.4.11 ( A Y 2011-12)02-03-2011 KUMBHAT & CO., 6
  • 7. DIRECT TAX Transfer Pricing New Section 94A - effective from 1.6.2011 Objective to discourage transactions with person located in any country or jurisdiction which does not effectively exchange information with India The transaction will be deemed to be with AE and no expenditure (including depreciation) will be allowed Tax will have to be deducted @ 30% for any payment made or rates in force whichever is higher02-03-2011 KUMBHAT & CO., 7
  • 8. DIRECT TAX - Miscellaneous Liaison Office of Foreign Companies or firms or association to file Annual Information Return within 60 days of close of financial year in prescribed form, w.e.f. 1.6.2011 Salaried persons with income < Rs.5.00 lacs need not file return if entire tax is paid by Employer and has no other source of Income Processing of returns in Central Processing centers Document Identification Number ( DIN) for any document filed with Income tax department - Omitted Settlement Commission given powers to rectify its Orders02-03-2011 KUMBHAT & CO., 8
  • 9. INDIRECT TAX - Excise Central Excise duty rate maintained at 10% Concessional rate of excise duty enhanced from 4% to 5% Excise duty of 1% imposed on 130 specified items which were earlier exempt or chargeable to nil rate of excise duty. Optional levy on branded garments or made up proposed to be converted into a mandatory levy at unified rate of 10% Reference for Retail Sales Price (RSP) valuation changed to Legal Metrology Act, 2009 Penalty provisions revamped & waiver of show cause notice and conclusion of proceedings would be available if the duty along- with interest and specified penalty is paid before the issue of SCN02-03-2011 KUMBHAT & CO., 9
  • 10. INDIRECT TAX - Excise Person engaging job worker for manufacture of apparel, garments and textile made ups will be liable to pay excise duty on such manufacture. Alternatively, the job worker can also be authorized by such person to discharge all excise liabilities. (w.e.f. 1.4.2011) Interest on delayed/ non-payment of duty fixed at eighteen percent w.e.f. 1.4.2011 Capital goods to include goods used for generation of electricity outside the factory of manufacturer for captive use within the factory.02-03-2011 KUMBHAT & CO., 10
  • 11. INDIRECT TAX Service Tax Service tax to be paid at the time of Point of Service and not on collection basis 2 New services introduced: - Services by air-conditioned restaurants having license to serve liquor; and - Short-term accommodation in hotels / inns / clubs / guest houses etc Rate of Service Tax retained at 10% to create foundation for GST Individual and sole proprietors provided relief from Service Tax audit by Department subject to having turnover less than INR60 lakhs The words activities relating to business have been deleted from the definition of input service which will have major impact in terms of restrictive availment of CENVAT Credit02-03-2011 KUMBHAT & CO., 11
  • 12. INDIRECT TAX Service Tax Scope of following existing services expanded: Authorized Service Station service: To cover all persons and all motor vehicles other than those meant for goods carriage or three wheeler auto rickshaw Commercial Training or Coaching Services: Scope expanded to include all coaching and training that is not recognized by law Club or Association Services: Services provided to non-members covered Legal Consultancy Services: Service provided by a business entity to individuals in relation to advice, consultancy or assistance in any branch of law, in any manner; (02-03-2011 KUMBHAT & CO., 12
  • 13. INDIRECT TAX Service Tax Legal Services: representational service provided by any person to any business entity (representational services, provided to individuals will continue to be exempt); and Health Services: Scope of health services expanded in respect of clinical establishment having central air- conditioning facility in any part of the establishment and more than 25 beds for in-patient treatment02-03-2011 KUMBHAT & CO., 13
  • 14. INDIRECT TAX Customs Duty Self Assessment system being introduced in Customs duty payment and assessment All clearances from SEZ into DTA are being exempted from SAD provided they are not exempt from the levy of VAT /Sales in DTA Time Limit for claiming refund of duty & interest reduced from one year to six months E-filing of entry of imported goods and exported goods introduced and Commissioner to allow filing of entry in any other manner when it is infeasible to present electronically02-03-2011 KUMBHAT & CO., 14
  • 15. Capital Markets No major changes impacting Capital Markets except for: FII cap on investment in domestic bonds hiked by USD 20 Billion Foreign investors can invest in domestic equity markets through mutual funds GDP Growth rate estimate for 2010-11 at 8.6% and for 2011-12 at 8.75-9.25% Rising commodity and fuel prices coupled with inflation continue to remain key concerns02-03-2011 KUMBHAT & CO., 15
  • 16. Have a Good day!! Do revert to us @ contact@bhansali.in Visit us @ www.bhansali.in Call us @ 0422-254433802-03-2011 KUMBHAT & CO., 16