Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ACCOUNTING STANDARDS :: TDS :: VAT Audit :: due date for vat payment :: empanelment :: cpt :: Central Excise rule to resale the machines to a new company :: VAT RATES :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: form 3cd :: ACCOUNTING STANDARD :: articles on VAT and GST in India :: ARTICLES ON INPUT TAX CREDIT IN VAT
 
 
Forex »
 Perils of an ad hoc forex policy
 Rupee depreciated by 17 paise to Rs 45.62 a dollar in early trade
 Rupee strengthened by 7 paise against dollar
 Rupee up by 4 paise against dollar in early trade
 Rupee falls by 18 paise at 4-week low against dollar
 Rupee drops on weak shares; inflation eyed
 Rupee raises 6 paise against dollar in early trade
 Rupee among most traded in futures market
 Indian rupee gain 12 paise against US dollar
 Rupee marginally rise up by 1 paise against US dollar
 Rupee drops tracking euro, choppy shares

More tax on forex derivative loss
April, 03rd 2010

Forex derivatives are back in the news and this time, for tax trouble! An internal circular issued last week by the Central Board of Direct Taxes (CBDT) will result in higher taxes for companies that have unrealized foreign exchange derivative losses, reports.

Last week, the CBDT issued a circular which said the outstanding losses are 'contingent'.  They are not deductible and have to be added back to taxable income.

Rostow Ravanan, CFO, MindTree, said, "Many of us in the industry -- IT and non-IT companies -- and many of the export-oriented industries have taken a huge hit on the portfolio and have made mark-to-market provisions. Now, if I have to go back and add that back, returns for that year have already been filed, advance tax for that year has already been paid so on and so forth.

Now, if I got back and do the calculation and my tax liability increases, will I be in default? Will I be accused of having short paid my taxes? Would interest and penalties apply? Those are all the problems you are now trying to grapple with."

As per the CBDT's maxim, a forex derivative transaction is 'speculative' and cannot be set-off against business income.

Commenting on the CBDT circular, experts stated that it is not binding on tax payers. They expect significant litigation going forward.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Company Overview

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions