Relief in tax payable under section 206(1) due to operation of section 206(1)(i)

The formula (sub-rule 1). The tax payable under section 206(1) for the tax year is reduced by (A − B) − (C − D), where, in each case taking the value as zero where no tax is payable:

• A is the tax payable under section 206(1) on the book profit of the tax year including the past income;
• B is the tax payable on the book profit of the tax year excluding the past income;
• C is the aggregate tax payable on the book profit of the past year or years to which the past income belongs, after increasing that book profit with the relevant past income; and
• D is the aggregate tax payable on the book profit of those past years without the increase.

Rules around it (sub-rules 2 to 5). If the value is negative, it is deemed zero. "Past income" is the income of past year or years included in the book profit of the tax year because of an advance pricing agreement under section 168 or a secondary adjustment under section 170. The tax credit allowed under section 206(1)(m) is reduced by the amount of this relief. The claim is made in Form No. 53, by uploading a signed printout in the manner specified by the Principal Director General or Director General of Income-tax (Systems), verified by the person authorised to verify the return under section 265.