CA IPCC Tax Amendments for Nov 2017 (Also in PDF) including Indirect Tax Amendments and Syllabus were provided below. Budget 2016 will be applicable for Nov 2017 CA IPCC Exams. And also, all Notifications and Circulars issued by the CBDT until April 1st 2017, will be applicable for CA IPCC Nov 2017 Tax Exam. In Indirect Tax Part, there are no much amendments, however, Income Tax syllabus have few significant amendments. ICAI has already issued Supplementary Study Material explaining the amendments in CA IPCC Tax for Nov 2017. There are no changes in Income Tax Slabs rates. CA Gaurav Jain has explained these amendments below. We will also recommend students to download Tax Notes made available in CAexam.
Features of CA IPCC Tax Amendments
|Share of Amendments||4%|
|Study Material||Given Below|
List of IPCC Tax Amendments Nov 2017
When ever a new union budget is introduced, it brings in lot of new changes. For IPCC Students, these amendments will be reflected in May Exams every year.
So, For Nov 2017 exams, there are not many new amendments since May 2017. There are only 2 Changes in Tax Syllabus when compared to May 2017, that too in DT only. These are listed below:
For Calculating Deemed Profit under section 44AD, the rate of profit has been reduced to 6% for receipts through Digital Means. Note that, for cash receipts, still the old rate of 8% will apply.
For example, A Hotel in Mumbai has a total turnover of Rs.80 Lakhs. The hotel only accepted payments through Debit Card and Paytm. Now, this Hotel can show their Profit as only 6% of total sales, instead of 8%.
Earlier, on any unexplained incomes (Black Money), the tax has to be paid at 30%. Now, this rate has been increased to 60% under Section 115BBE. (Expect a Question from this topic).
Applicability of KKC
The applicable Rate of Krishi Kalyan Cess is 0.5%. This takes the total Service Tax Rate to 15% (14% Service Tax + 0.5% SBC + 0.5% KKC).
The Krishi Kalyan Cess calculation is similar to that of regular Service Tax calculation. The KKC shall be levied on the taxable value of the service. You should note that KKC is not calculated on the Service Tax amount, but, shall be levied on the entire taxable value of the service.
ICDS which is recently introduced by the CBDT will be applicable for Nov 2017 CA IPCC Tax Exam. The same has been specified by the ICAI in an Announcement.
Deduction for Interest on Capital borrowed for house construction can be claimed up to Rs. 2 Lakh. To claim this deduction, the house construction shall be completed with in 5 years (Earlier, the house construction shall be completed with in 3 years. This was recently amended to 5 years).
This particular amendment in CA IPCC Tax Paper is very important for Nov 2017 Exam.
Any income from Non-Compete fee received by an Assessee shall be taxable as Business Income. This is covered under section 55 of Income Tax Act.
Corporate Tax Reduced to 25%
This is one of the most important incentive offered by the Finance Minister in the recently introduced budget. As per this incentive, the new rate of Corporate Tax is 25% (This is 30% earlier).
IPCC Students should also stress on this amendment as there are high chances that this amendment will be covered in Nov 2017 Tax Paper.
Spectrum Fee Tax
This covers the expenditure by any telecom company on payment on spectrum fee to the government.
This is relatively large amendment and students can read this from the Tax Amendments Material Provided below for Nov 2017.
NBFCs Bad Debts Deductible
This is also one of the important amendment in Tax for Nov 2017. Non Banking Finance Corporations can claim deduction for Provision for Bad Debts under section 36(1)(viia).
44AD Limit changed
The threshold limit for Gross Receipts under section 44AD has been increased to Rs.2 Crore. Earlier, this limit is Rs.1 Crore Only.
This is a newly inserted section. This provision lays down presumptive taxation benefit for Professionals.
This Amendment has also been covered in the Material provided below for Nov 2017.
CG on Unlisted Shares
The Period of holding of unlisted shares in order to be qualified as a Long-Term Capital asset has been brought down to ‘more than 24 months’. Earlier, it is ‘more than 36 months’.
Total Value of assets of a private company or unlisted company not to exceed Rs.5 crore in any of the three preceding previous years for exemption of transfer of capital asset or intangible asset on conversion of such company into LLP.
Gold Bonds Amendment for Nov 2017 Tax Paper
Redemption by an individual of sovereign gold bonds issued by RBI does not constitute transfer for the purpose of levy of capital gains tax. In simple words, it is not taxable.