Income Tax – Shipping Companies
Finance (No. 2) Act, 2004 has inserted a new chapter XII-G dealing with Special provisions relating to Income of shipping companies with effect from 1.4.2005. Now the Government has come up with new Rules to explain how deemed tonnage is to be computed. The rules also explain what the incidental activities are for the purpose of shipping income. They are:-
(i) maritime consultancy charges;
(ii) income from loading or unloading of cargo;
(iii) ship management fees or remuneration received for managed vessels; and
(iv) maritime education or recruitment fees.
The Rules also prescribe a new form 66 for the Auditor’s report for these companies. The Form under column 12 requires information on Modified Value Added Tax credit claimed and allowed under the Central Excise Rules, 1944 or Central Excise Rules, 2002. May be the CBEC has not informed the CBDT that there is no Modvat now.
IT NOTIFICATION. No. 120/2005, Dated: March 29, 2005