Corporate Tax - Introduction

For the Assessment Year 2007-08

Description	Existing Rate* (%)	Proposed Rate* (%)	Difference + - = (%)
Domestic Company
Regular Tax	33.6	33.9**	+0.33
MAT	11.22(of book profits)	11.33(of book profits)	+0.11
DDT	14.025	16.995	+2.97
Foreign Company
Regular Tax	41.82	42.33#	0.41

*It includes the applicable surcharge and the education cess.**If the income is equal or less than Rs 10 million, it is 30.9%.
#If the income is equal or less than Rs 10 million, it is 41.2%.

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A company has been defined as a juristic person having an independent and separate legal entity from its shareholders.Income of the company is computed and assessed separately in the hands of the company. however the income of the company which is distributed to its shareholders as dividend is assessed in their individual hands. Such distribution of income is not treated as an expenditure in the hands of company, the income so distributed is an appropriation of the profits of the company.Residence of a company :A company is said to be a resident in India during the relevantprevious year if:

1. it is an Indian company
2. if it is not an Indian company then, the control and the management of its affairs is situated wholly in India

A company is said to benon-resident in India if it is not an Indian company and some part of the control and management of its affairs is situated outside India.