The amendment proposes to change the criteria for classification of a company as a “Small Company” (to reap the benefits of lower rate of tax of t20%).  After the proposed amendments (1) the condition for maximum annual turnover would be relaxed by increasing the amount from Rs. 200 million to Rs. 250 million, and (2) a new condition regarding maximum number of employees, i.e. not exceeding two hundred and fifty (250) any time during the year, is being introduced.  The other conditions to qualify as a “Small Company” are that the company:

• Should have paid capital plus undistributed reserves not exceeding Rs. 25 million; and
• is not formed by the splitting up or the reconstitution of company already in existence.