Taking a call on what kind of treatment would the market decide for RIL’s fate for the amount received from BP is difficult. The advance Tax for RIL is on the higher side for the month of October. Experts are now trying to collate the tax liability that would now pile up on the company with its present developments.
The kind of depreciation claimed by the company on the exploration assets is not desirable by any company. However it includes the profit that is to be taxed in the financial year on the total amount received by the company. In the previous year the company had received about Rs.9000 crores from BP which was not offered as tax by the company. It is about Rs.35,000 crores that has been received by RIL from BP which will include tax too.
The knockoff amount cannot yet be decided at aby specific percentage levels but estimating that 15% is the benchmark the amount of tax comes to around Rs.4500 crores. Being an instalment of 30% the figure comes out to be Rs.7.5 crores, which has been paid by them giving it a larger share in the taxable profits. The taxable profit that accrues with the BP deal on the total amount of Rs.35000 crores is certainly a high tax liability for the company going forward with its deal.
Bell the Bull says: Higher Tax Liabilities for RIL with the amount received from BP
Reliance Industries on the higher side for its tax liabilitiesGoogle+