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Program.Program.

Images of textile machines & goodsImages of textile machines & goods

TopicsTopicsCorporate taxation procedureCorporate taxation procedure

((Manufacturing concernManufacturing concern))

Group Name : D

Section : B

Selected Company : Textiles

Presented by: MD.Rokonusz-zaman

Ashis saha

Indispensable Part of DiscussionIndispensable Part of Discussion

The followings have the paramount importance to get an idea concerning the – • Textile Industries

• Its Importance

• Contribution to GDP

• Contribution to govt. revenue

• Current export volume

• International market position

Textile industry includes every business involved in- - Growing or producing fiber

- Making the fibers into threads

- Making the threads into cloth

- Dyeing cloth

- Bleaching and finishing the cloth

Textile Industry also include chemical companies that make – -Synthetic Fibers and all that resultant products

Significance :

Textile Industry is of supreme importance because it –

• Has great contribution in earning foreign exchange.

• Increases export volume

• Creates huge employment opportunity

• Contributes to the govt. revenue

• Contributes to the GDP

• Helps in attaining economy growth

• Creates vast employment opportunity for women.

• Develops infrastructure.

International Market PositionInternational Market Position

Export Market

Year USA E.U

Textile Clothing Textile Clothing

Market Share

1995 3% 4% 3% 3%

Market Share

2004 3% 2% 3% 4%

CurrentCurrent export volume :export volume :

Textile exports from Bangladesh to USA did Textile exports from Bangladesh to USA did increase by 10% in 2009.increase by 10% in 2009.

Contribution of textile industry

Year Heads Percentage

2008

GDP 17.78%

Economic growth 5.92%

Employment 10.92%

Assessment Procedures Assessment

Assesse Receiving IT – 88IT-30

Appeal (if not satisfied)

Assessing officer

Filling

ReturnAudited Reports

Vouchers Ledgers

Accepting return, Audited Reports

Vouchers

Preparing IT – 88 and IT 30 to be sent to Assesse

Sending demand Notice

Receipt of Tax

Getting demand notice (If satisfied)

Tax payment

Universal Self -AssessmentUniversal Self -Assessment

The Company own self may practice self assessment to determine taxable income and tax liability. (U/S 82BB)

Documents to be attached with the return (in case of self-assessment)

• Statement of A/C audited by Chartered Accountant. • Depreciation chart as per 3rd schedule. • Computation of income according to income tax law.

Profile of CompaniesProfile of Companies we visitwe visit

UTAH Spinning Mills Ltd.

Sales Status : 100% export oriented Status : Non publicly traded companyCommencement of production: 2000

HR Textile Mills Ltd.In-corporation : 1994 Status : Publicly traded companyCategory : B

Asian Textile LtdStatus : Non publicly traded companySales Status : Export oriented Commencement of production: 1999

Tallu Spinning Mills Ltd.Incorporation : 1985Status : Publicly traded company Business Line : Import raw cotton and manufacture of yarn.

Square Textiles Ltd.Status : Publicly traded company Business Line : Manufacturing and marketing of yarn. Category : A

Saiham Textile Mills Ltd.Status : Publicly traded company Sales status : Local & Export oriented. Category : B

Company Assessment show: 01

Company Name : H.R. Textile Mills Ltd.Status : Public CompanyAssessment year : 2007-2008Income year : 2006-2007

Computation of total taxable income

IT-88 (Large)

Particulars Tk. Tk.

Net profit as per audited reports

Add. For separate consideration

Depreciation expense

Entertainment expense

Less. Non-business income

Dividend income from investment

Interest on tax-free govt. securities

Profit on sale of machinery

*****

*****

*****

*****

*****

*****

*****

*****

Add. Inadmissible expenses

Office rent

Telephone & Telegram

Electricity charge

Provision for tax

Provision for gratuity fund

Others expenses

Advanced tax payment

Printing expense

Subscription & donation

Office maintenance

Fines paid in port

Car maintenance & repairs

Reserve

Fuel expenses

Dividend equalization fund

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

*****

Due to non-deduction of taxes & VAT at source and non-submission of vouchers applicable in respect of expenses.

Less. admissible expenses

Depreciation as per 3rd schedule

Entertainment allowance

Add. Revenue income on sale of machinery

Total business income

*****

*****

*****

*****

**********

*****

*****

Total income from business: *****

Add. Others income

Dividend income from investment *****

Capital gain on sale of machinery *****

*****Total taxable income

Computation of tax liability

Tk. Tk.

On dividend @20%

On capital gain@15%

On the balance@15%

Total tax

Less. Advance tax payment

Net tax liability

*****

*****

***** *****

*****

*****

*****

*****

IT-30

Company Assessment show: 02

Company Name : …………………..Status : Non Public CompanyAssessment year : 2007-2008Income year : 2006-2007Accounting period : 01.0 1. 06 - 31.12.06

Computation of total taxable income

IT-88 (Large)

Particulars Tk. Tk.

Net profit as per audited reports

Add. For separate consideration Depreciation expense

Entertainment expense

Sample expense

40070357

630

978560

15479587

41049547

56529134

Add. Inadmissible expenses

Conveyance allowance

Stationary expenses

Office maintenance

Others expenses

Business promotion

Traveling expenses

Car fuel

Telephone bill (Mobile)

Telephone bill (T&T)

Rest house expenses

Foreign employment expenses

Subscription & donation

Sundry expenses

5000

4000

40000

3000

500000

80000

50000

30000

10000

100000

20000

5000

70000

56529134

917000

57446134

Due to non-deduction of taxes & VAT at source and non-submission of vouchers applicable in respect of expenses.

Less. admissible expenses

Depreciation as per 3rd schedule

Entertainment allowance

Sample expenses

43039950

978560

630

57446134

44019140

13426994Total business income (Taxable)

Computation of tax liability

Tk. Tk.

On the taxable income@15%

Less. TDS

Add. Interest @10% (2307800X.10)*2

Net tax payable

2014049

356637

1657412

230780

1888192

IT-30

Company Assessment show: 03

Company Name : Asian Textile Mills Ltd.Status : Non Public CompanyAssessment year : 2007-2008Income year : 2006-2007Accounting period : 01.0 7. 06 - 30.06.07

Computation of total taxable income

IT-88 (Large)

Particulars Tk. Tk.

Net profit as per audited reports

Add. For separate consideration Depreciation expense

Entertainment expense

1318784

27569

343225

1346353

1689578

Add. Inadmissible expenses

Printing & stationary

Electricity bill

Postage & stamp

Audit & professional feeSundry expenses License & renewal expenses

Sales commission

Carriage outward

Less. Admissible expenses Depreciation as per 3rd schedule

Total taxable income

8000

10000

5000

20000

6000

6000

296570

100000

1689578

451570

2141148

2141148

0

Due to non-deduction of taxes & VAT at source and non-submission of vouchers applicable in respect of expenses.

Notes :

1. Current year depreciation 2171467

Previous year depreciation 1424337

3595804

Which has been adjusted against income & the balance (3595804-2141148) =1454656 will be treated as admissible expense in the next year

2. There is no entertainment allowance since there is no taxable income.

3. The company is not required to pay tax since its taxable income is zero.