Apply for re-computation of income under Rule 132 to avoid tax penalty

Those with income from business or profession, who have availed deduction on cess/surcharge, must do so by March 31

Rule 132, introduced by the Central Board of Direct Taxes (CBDT), came into effect on October 1, 2022. It deals with the application for re-computation of income under Section 155(18). CBDT has also notified Form 69 that can be used to apply for re-computation of income.

Abhinay Sharma, managing partner, ASL Partners says, “Finance Act 2022 had inserted Section 155(18). The Assessing Officer (AO) has been given the power to re-compute the total income of assessees who fall under Section 40(a)(ii) of the Income-Tax Act, 1961.”

Section 40 deals with amounts that can’t be availed as deduction when computing profits