Explanatory Notes to the provisions of the Finance Act, 2022
Income Tax department released the Circular regarding Explanatory Notes to the provisions of the Finance Act, 2022 .
The Finance Act, 2022 (hereafter referred to as ‘FA 2022’) as passed by the Parliament, received the assent of the President on 30th March, 2022 and has been enacted as Act NO.6 of 2022.
This circular explains the substance of the provisions of the FA 2022 relating to direct taxes.
The Health and Education Cess on income-tax shall be levied at the rate of four per cent. on the amount of tax computed inclusive of surcharge .
No marginal relief shall be available in respect of Health and Education Cess.
Health and Education Cess.
Hea llh and Education Cess on income-tax shall continue to be levied for the purposes of the Union at the rate of four per cent of income-tax including tax deducted and surcharge, if any. For instance. if the amount of income of a foreign company is Rs. 1,20,00,0001- and tax to be deducted from such foreign company is Rs. 12 ,00,000/- at the rate of 10 percent, then the surcharge at the rate of two per cent on such tax deducted shall be Rs.24,0001-. Health and Education cess on such amount of tax deducted and surcharge (i.e.Rs. 12,00,000/- + Rs. 24,0001-; Rs. 12,24,000/-) shall be Rs. 48,9601-.
Digital Book of Accounts or ledger –
With the advancement of technology and its widespread utility in daily conduct ofbusiness, books of account are maintained in electronic form by a significant section of the asses sees in the current age.
Therefore, to align the definitions under the Act with the current practices, clause (12A) of section 2 of the Act has been amended so as to provide that the definition of books or books of account would include books or books of account kept in electronic or in digital form or as print outs of data stored in such electronic or in digital form.
More details on
Explanatory Notes to the provisions of the Finance Act, 2022
PR Source – https://incometaxindia.gov.in/communications/circular/circular-23-2022.pdf
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