| Tax |
Nature of Levy |
| Corporate tax |
Tax on income earned by a company during a financial year (April 1 to March 31).
Scope of taxable income dependent upon residential status of the company |
Dividend
Distribution Tax (‘DDT’) |
Tax on dividends declared by a domestic company |
| Minimum
Alternate Tax |
Tax payable on book profits where normal corporate tax payable is less than 10%
of book profits |
| Fringe Benefit Tax |
Tax introduced from Financial Year 2005-06 to tax fringe benefits provided to employee and certain expenses incurred by entities. Tax payable even by loss making companies |
Transfer pricing regulations |
Transfer pricing regulations applicable in respect of international transactions between associated enterprises |
| Tax payer |
Category of income |
General tax rate (Note1) |
Minimum Alternate Tax |
Dividend Distribution Tax (DDT) |
| Domestic companies |
Business profits |
33.99 % |
11.33 % (on book profits) |
16.995 % |
| |
Long term capital gains (LTCG)(Note 2 & 4) |
22.66 % |
|
|
| |
Short term capital gains (STCG)(Note 3 & 4) |
33.99 % |
|
|
| Foreign companies (Note 5) |
Business profits/ STCG (Note 3) |
42.23 % |
10.56 % (on book profits) |
|
| |
Long term capital gains (LTCG) (Note 2 & 4) |
21.12 % (Note 2) |
|
|
| |
Interest (Note 6) |
21.12 % |
|
|
| |
Royalty & Fees for technical services for agreements entered into on or after June 1, 2005 (Note 6) |
10.56 % |
|
|
