MSME dues due beyond the time limit

 MSME dues due beyond the time limit have to be cleared by 31st Mar 2025:

1. Introduction: Section 43B(h) was introduced in the Finance Act, 2023, and applies from AY 2024-25 onwards. It deals with the deduction of payments made to Micro and Small Enterprises (MSEs) under the Micro, Small, and Medium Enterprises Development (MSMED) Act, 2006. 2. Deduction Allowed on Payment Basis: Any sum payable to MSEs for goods or services will be allowed as a deduction only in the year in which the actual payment is made. 3. Exception – Statutory Payment Deadlines: If the payment is made within the time limit prescribed under Section 15 of the MSMED Act, 2006, deduction will be allowed on an accrual basis (i.e., even if not paid before the year-end). Section 15 prescribes: 45 days if there is a written agreement. 15 days if there is no agreement. 4. Non-MSMEs Are Not Covered: This provision applies only to payments to Micro and Small Enterprises (MSEs) registered under the MSMED Act, not to Medium Enterprises or non-MSME suppliers. 5. Practical Impact: Businesses must clear MSE dues before 31st March 2025 or as per MSMED timelines to claim deductions in the same year. If payment is delayed beyond the MSMED Act timelines, deduction will be deferred to the year of actual payment

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