The weekly messenger | Edition 28.17
This newsletter is a weekly compilation of accounting, auditing and related regulatory news from different accounting and regulatory bodies in India and overseas.
Accounting News
ED on Ind AS 116 Leases- 18 July 2017
The Accounting Standards Board of the Institute of Chartered Accountants of India has issued an Exposure Draft (ED) on the Indian Accounting Standard (Ind AS) 116 “Leases” which would supersede the existing Ind AS 17. This Ind AS sets out the principles for the recognition, measurement, presentation and disclosure of leases.
This standard is proposed to be effective from annual periods beginning on or after 1 April 2019.
Comments are to be received till 31 August 2017.
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FSB urges insurers to start implementation of IFRS 17 as soon as possible- 17 July 2017
The Financial Stability Board (FSB) has issued a statement whereby it has encouraged the firms to start the implementation efforts w.r.t. International Financial Reporting Standard (IFRS) 17 “Insurance Contracts” as soon as possible and also has highlighted the significance of its proper application.
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IFRS Foundation publishes illustrative tagging for IFRS 17 Insurance Contracts- 19 July 2017
The IFRS Foundation has published illustrative tagging for the proposed IFRS Taxonomy Update IFRS Taxonomy 2017—IFRS 17 Insurance Contracts. This illustrative tagging shows how selected information from the Illustrative Examples accompanying IFRS 17 could be tagged using the proposed IFRS Taxonomy Update. It is published in eXtensible Business Reporting Language (XBRL) and iXBRL (inline XBRL) formats.
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Regulatory News
Disclosure of divergence in the asset classification and provisioning by banks – 18 July 2017
The Securities and Exchange Board of India has issued a circular wherein it has asked all the banks which have listed specified securities to disclose the stock exchanges divergences in the asset classification and provisioning in certain class of cases in the form of an Annexure provided along with the Reserve Bank of India’s notification no. RBI/2016-17/283; DBR.BP.BC.No.63/21.04.018/2016-17 dated 18 April 2017.
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Modification of Circular No.1 of 2014 in view of substitution of Service Tax by GST - 19 July 2017
The Central Board of Direct Taxes (CBDT) vide its circular no. 1/2014 dated 13 January 2014 has clarified that wherever in terms of the agreement or contract between the payer and the payee, the Service Tax component comprised in the amount payable to a resident is indicated separately, tax shall be deducted at source (TDS) under Chapter XVIl-B of the Income tax Act, 1961 on the amount paid or payable without including such Service Tax component.
Now, after receiving various references seeking clarification w.r.t. the treatment of Goods and Services Tax (GST) for the purpose of deduction of tax at source, CBDT has clarified that even under the new GST regime, the rationale of excluding the tax component from the purview of TDS remains valid. Accordingly, TDS under Chapter XVII-B will be deducted on the amount paid or payable without including such 'GST on services' component. GST for these purposes shall include Integrated GST, Central GST, State GST and Union Territory GST.
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Increase in the Compensation Cess rate on cigarettes - 17 July 2017
The GST Council realised that the total tax incidence on cigarettes in the GST regime has come down as compared to the total tax in pre-GST regime. Due to this, GST Council in its meeting held on 17 July 2017 has reviewed the Compensation Cess rates on cigarettes and increased the same w.e.f. midnight of 17 July 2017 considering cigarette as a demerit good.
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Clarification on GST rates on hotel accommodation - 18 July 2017
The Central Board of Excise and Customs (CBEC) has clarified that accommodation in any hotel, including 5-star hotels having declared tariff of a unit of accommodation of less than INR 7500 per unit per day, will attract GST @ 18% and not 28%. Therefore, star rating of hotels is irrelevant for the purpose of determination of applicable rate of GST.
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Extension of time limit for filing intimation for composition levy – 21 July 2017
CBEC has extended the period for filing intimation for composition levy in form GST CMP-01 under sub-rule (1) of Rule 3 of the Central GST Rules 2017 up to 16 August 2017.
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Concerns of taxpayers arising from transition to the GST regime – 22 July 2017
CBEC has expressed its concern for the small taxpayers opting to pay tax under the compensation scheme by providing certain relaxations which are as follows:
- Time limit for filing of intimation for composition levy has been extended to 16 August 2017,
- Time limit for application of cancellation of registration in case of those taxpayers who were provisionally migrated by virtue of being registered under the existing laws, but who are no longer required to be registered under GST has been extended to 30 September 2017.
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GST Twitter Handle FAQs
CBEC has issued certain twitter handled Frequently Asked Questions (FAQs).
For FAQs, click here