Minimum alternate tax exists because a company can be highly profitable in its accounts and pay almost nothing in tax. MAT sets a floor based on book profit rather than taxable income — and Form 29B is where an accountant certifies what that book profit is.
At a glance
- What it is
- Accountant’s report certifying book profit for MAT
- Provision
- Section 115JB(4), read with Rule 40B
- Who files
- A company liable to minimum alternate tax
- Who signs
- A Chartered Accountant in practice
- Deadline
- One month before the return due date
- Credit
- MAT credit carried forward under section 115JAA
- Under the 2025 Act
- Section 206
How MAT works
A company computes its tax twice. Once normally, under the ordinary provisions. Once on book profit, at the MAT rate. It pays the higher of the two.
The difference between the two is not lost — it becomes MAT credit under section 115JAA, available to set off in later years when normal tax exceeds MAT.
MAT is a timing mechanism, not an extra tax. Explained that way, clients take it better. The company pays earlier than it otherwise would and recovers the difference through credit in profitable years — subject to the carry-forward period.
Who is still caught
The concessional corporate tax regimes changed the picture substantially. A company that has opted into the concessional regime under section 115BAA or 115BAB is outside MAT — and also gives up its accumulated MAT credit on doing so.
| Company | MAT applies? |
|---|---|
| Company under the ordinary regime | Yes |
| Company that opted for section 115BAA | No — and MAT credit lapses |
| New manufacturing company under section 115BAB | No |
| Company in an IFSC deriving income solely in convertible foreign exchange | Concessional MAT rate |
| Foreign company without a permanent establishment in India | Generally outside, subject to conditions |
Opting into 115BAA forfeits accumulated MAT credit. This catches companies that switch to the lower headline rate without checking their credit balance. Where a large MAT credit exists, the switch can cost more than it saves. Run both numbers before electing — the election is generally irreversible.
Building book profit
Book profit starts with the profit shown in the profit and loss account prepared under the Companies Act, 2013, then applies the additions and deductions listed in the Explanation to section 115JB.
| Typically added back | Typically deducted |
|---|---|
| Income tax paid or payable, and provisions for it | Amount withdrawn from reserves, if credited and previously added |
| Amounts carried to any reserve | Income exempt under sections 10, 11 or 12 (with exceptions) |
| Provision for unascertained liabilities | Depreciation debited, other than on revaluation |
| Provision for diminution in the value of assets | Lower of brought forward loss or unabsorbed depreciation, as per books |
| Deferred tax and provision for it | Profits of a sick industrial company, in the specified circumstances |
The brought-forward adjustment uses book figures, not tax figures. The deduction is the lower of brought forward loss or unabsorbed depreciation as per the books of account — and if either is nil, no deduction is available at all. This is one of the most commonly miscomputed items in the whole calculation.
Ind AS companies
Companies preparing accounts under Indian Accounting Standards have a further layer: adjustments for items routed through other comprehensive income, and a transition-amount adjustment spread over five years from the year of convergence.
Form 29B has a dedicated part for this. Where a company has converged to Ind AS, the OCI analysis and the transition schedule need to be prepared as part of the audit file rather than assembled at the point of filing.
Deadline
Form 29B is furnished electronically one month before the due date for the return — 30 September where the return is due 31 October, the same rhythm as the tax audit report. The CA files it and the company must accept it on the portal.
UDIN on Form 29B
Form 29B is a report signed by a practising Chartered Accountant. As a certification supporting a computation it sits in the Certificates category, mandatory since 1 February 2019.
Update within 60 calendar days of upload. A form uploaded without a UDIN and not updated inside that window is treated by the CBDT as invalid, with all due consequences of law, even after the company has accepted it. Since section 115JB(4) makes the report a condition, an invalid Form 29B undermines the MAT computation itself. Revocation closes at 48 hours.
See our guide to UDIN generation.
MAT under the Income-tax Act, 2025
| Subject | 1961 Act | 2025 Act |
|---|---|---|
| Minimum alternate tax and alternate minimum tax | Sections 115JAA, 115JB, 115JC | Section 206 |
Per ICAI’s tabular mapping, the 2025 Act consolidates MAT, AMT and the credit provisions into a single section — 206, “Special provision for minimum alternate tax and alternate minimum tax”. The non-corporate counterpart is Form 29C.
Frequently asked questions
Who has to file Form 29B?
Every company to which section 115JB applies, certifying that book profit has been computed in accordance with the section.
When is it due?
One month before the due date for furnishing the return of income.
Does MAT apply if we opted for section 115BAA?
No. Companies under the concessional regimes in sections 115BAA and 115BAB are outside MAT — but they also forfeit accumulated MAT credit.
What happens to the extra tax paid under MAT?
It becomes MAT credit under section 115JAA, available for set-off in later years when normal tax exceeds MAT.
What is book profit?
The profit per the profit and loss account prepared under the Companies Act, 2013, adjusted by the additions and deductions specified in the Explanation to section 115JB.
How is the brought-forward loss adjustment computed?
The lower of brought forward loss or unabsorbed depreciation as per the books of account. If either is nil, no deduction is available.
Do Ind AS companies compute it differently?
Yes. There are additional adjustments for other comprehensive income items and a transition amount spread over five years, with a dedicated part of Form 29B for them.
Which rule prescribes the form?
Rule 40B of the Income-tax Rules, 1962.
Is UDIN required?
Yes, with the 60-calendar-day update rule after upload.
Which section replaces 115JB under the new Act?
Section 206, which covers MAT, AMT and the related credit together.
Can a Cost Accountant sign Form 29B?
No. It is an accountant’s report — a Chartered Accountant in practice.
In short
Form 29B is straightforward once book profit is right, and book profit is where the work sits — particularly the brought-forward adjustment on book figures and, for Ind AS companies, the OCI and transition schedules. The bigger commercial question usually arrives before the form: whether to stay in the ordinary regime or move to section 115BAA, because moving writes off accumulated MAT credit for good.
Micro Advisor advises companies on MAT computation, MAT credit planning and the related reporting.
References
Disclaimer. General information, not professional advice. MAT rates, regimes and adjustments have changed repeatedly; verify the position for the company and year concerned.