Upgrad LLM

mat credit


A person have balance of MAT Credit of previous years, & he want to set off this credit while calculating the tax liability of AY 2011-12.


While calculating the tax weather the person first should calculate the tax liability including cess & then deduct the MAT credit

OR

Should he first calculate the tax (excluding cess) & then adjust the MAT credit & then calculate the cess liability on balance amount.

According to me the first option should be followed but when I entered the data in Webtel software then the software followed the second option. The second optiion will reduce the cess liability of the payee & I think it is not correct.

 

Kindly advise..........

 

The question was also posted on caclubindia but don't get any proper reply...

the link of the same is:

http://www.caclubindia.com/forum/mat-credit-165061.asp

 
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