Business Income Tax Filing
According to the Income Tax Department of India, any Non Payment of annual business income taxes by the due date attracts penalties under the Income Tax Law.
Digital Filings can help you in…:
Understanding the Taxation requirements
Drafting required financial statements, including Income and Expenditure
Computing Taxable amount
Filing the annual return
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Understanding Business Income Tax Filings
Indian businesses need to file their annual Business Tax Returns on regular basis in order to conveniently conduct their operations. The tax return for a business depends on the books of accounts and income and expenditure statements, Balance Sheet, Profit, and Loss Account and details regarding assets and liabilities of a company. While, a business may also be advised to file Tax Deducted at Source (TDS) return and pay advance tax to stay compliant under the Income Tax Act.
A business entity is obliged to file business tax return irrespective of its business structure. The procedure to be followed depends on several factors, such as industry, investment, incurred profit or losses, among others. On exceeding annual turnover of over INR 1 Crore, the business is instructed to get a tax audit and in this case, the due date for filing business tax returns is September 30th. Whereas, organizations without the obligation of any tax audit are bound to complete their respective taxation formalities by July 31st.
Documents required for Tax Filing
Business Tax Returns based on Various Business Structures
Sole Proprietorship
Proprietorship is an entity that is owned and managed by the same person. This form of business structure is the most prevalent among micro and small sized businesses operating aross the nation. A proprietor must know following points before filing Business Tax Return.
- Income and Age Criteria
-
Proprietor’s Age
Taxable Annual Income Less Than 60 Years
More Than INR 2.5 Lacs
Between 60 Year to 80 Years
More Than INR 3 Lacs
Above 80 Years More Than INR 5 Lacs
- Income Tax Rates and Annual Income Slabs
- Income Slab based Income Tax Rates are charged where proprietors with higher income are supposed to bear higher Income Tax Rates.
Income Tax Rate
Taxable Annual Income Slabs
No Income Tax
Equal To or Less Than INR 2.5 Lacs
10%
Ranging Between INR 2.5 Lacs and INR 5 Lacs
20% Ranging Between INR 5 Lacs and INR 10 Lacs
30% More Than INR 10 Lacs
-
- Income Slabs based Tax Audit Requirement and Due Date
Taxable Annual Income Slabs
Proprietorship Type Tax Audit Requirement Due Date
More Than INR 1 Crore
Business Yes September 30th Receipts Up To INR 50 Lacs
Professionals (Lawyer / Doctors / Engineers) No July 31st
Receipts More Than INR 50 Lacs Professionals (Lawyer / Doctors / Engineers) Yes July 31st
- Business Tax Return Forms
-
Business Type
Form
Sole Proprietors OR Hindu Undivided Family (HUF) ITR-3
Sole Proprietors opting for Presumptive Taxation Scheme ITR-4 Sugam
Partnership Firms
Partnership business model includes two or more than two individuals agreed to carry out business activities, as per the agreed upon objectives prescribed in Partnership Deed.
- Income Tax Mandate
| Firm’s Operations |
Business Tax Return Requirement |
| Active Firm |
Taxable irrespective of Profits or Losses incurred |
| Inactive Firm |
NIL tax return is to be filed on or before the due date |
- Various Tax Rates
|
Tax Rate Type |
Tax Rate |
|
Income Tax Rate on Annual Income |
30% |
|
Income Tax Surcharge |
12% on annual income exceeding INR 1 Crore |
|
Education Cess |
2% on Income Tax and Surcharge Amount |
|
Secondary and Higher Education Cess |
1% on Income Tax and Surcharge Amount |
|
Minimum Alternate Tax |
Operational Partnership Firms are obliged to Pay 18.5%* of Minimum Alternate Tax on their adjusted annual incomes. *This rate does not Education Cess as well as Secondary and Higher Education Cess |
- Income Slabs based Tax Audit Requirement and Due Date
|
Taxable Annual Income Slabs |
Partnership Firm Type | Tax Audit Requirement* | Due Date |
|
More Than INR 1 Crore |
Business Firms | Yes |
September 30th |
|
Up To INR 50 Lacs Receipts |
Professional Firms (Law / Hospitals / Engineering) | No | July 31st |
| More Than INR 50 Lacs Receipts | Professional Firms (Law / Hospitals / Engineering) | Yes |
July 31st |
|
*There are certain terms and conditions that may also obligate a Partnership or Professional Firm to go through an audit. |
|||
- Business Tax Return Forms
|
Business Type |
Form |
|
Partnership Firm |
ITR-5* |
|
*No documents or financial statements are required to be attached along with the form, however, partners are advised to save all the relevant information and details in case an inspection is required by the concerned taxation authorities. |
|
Limited Liability Partnership (LLP) Firms
- Income Tax Mandate
|
Firm’s Operations |
Business Tax Return Requirement |
|
Active Firm |
Taxable irrespective of Profits or Losses incurred |
| Inactive Firm |
NIL tax return is to be filed on or before the due date |
- Various Tax Rates
|
Tax Rate Type |
Tax Rate |
|
Income Tax Rate on Annual Income |
30% |
|
Income Tax Surcharge |
12% on annual income exceeding INR 1 Crore |
|
Education Cess |
2% on Income Tax and Surcharge Amount |
|
Secondary and Higher Education Cess |
1% on Income Tax and Surcharge Amount |
|
Minimum Alternate Tax |
Operational LLP Firms are obliged to Pay 18.5%* of Minimum Alternate Tax on their adjusted annual incomes. *This rate does not Education Cess as well as Secondary and Higher Education Cess |
- Income Slabs based Tax Audit Requirement and Due Date
| Taxable Annual Income Slabs | LLP Firm Type | Tax Audit Requirement * | Due Date |
|
More Than INR 40 Lacs |
Business Firms | Yes |
September 30th |
|
Up To INR 25 Lacs Contributions |
Professional Firms (Law / Hospitals / Engineering) | No |
July 31st |
|
More Than INR 25 Lacs Contributions |
Professional Firms (Law / Hospitals / Engineering) | Yes |
July 31st |
|
Also, LLPs carrying out international transactions and / or entered in to certain specific domestic transactions are required to file Form 3CEB. LLPs need to get their respective Form 3CEB certified by a practicing Chartered Accountant (CA). The business tax filing due date for the LLPs with 3CEB Certification will be November 30th. |
|||
- Business Tax Return Forms
|
Business Type |
Form |
|
LLP Firm |
ITR-5 * |
|
* In case LLP opted for online submission for their business tax returns then Digital Signature Certificate (DSC) of the designated partner is required for such e-filings |
|
Domestic Company
A Company is regulated under the Companies Act of 2013 by Ministry of Corporate Affairs (MCA). Company form of business is most adopted framework worldwide.
- Income Tax Mandate
| Company’s Operations | Business Tax Return Requirement |
| Active Company | Taxable irrespective of Profits or Losses incurred |
| Inactive Company | NIL tax return is to be filed on or before the due date |
- Various Tax Rates
|
Tax Rate Type |
Tax Rate |
|
Companies with Annual Income of Less Than INR 50 Crores Tax Rate on Annual Income |
25% |
| Companies with Annual Income of More Than INR 50 Crores Tax Rate on Annual Income |
30% |
|
Income Tax Surcharge |
7% on annual income exceeding INR 1 Crore and 12% on annual income exceeding INR 10 Crores |
| Education Cess |
2% on Income Tax and Surcharge Amount |
|
Secondary and Higher Education Cess |
1% on Income Tax and Surcharge Amount |
| Minimum Alternate Tax |
Operational Companies are obliged to Pay 18.5%* of Minimum Alternate Tax on their adjusted annual incomes. *This rate does not Education Cess as well as Secondary and Higher Education Cess |
- Tax Audit Requirement and Due Date
|
Tax Audit Requirement |
Due Date |
| Companies are obliged to get their account books and financial statements audited every year |
September 30th |
- Business Tax Return Forms
|
Business Type |
Form |
|
Company (Both Private Limited Companies and Public Limited Companies) |
ITR-6 * |
We are Glad to Help!
Indian Businesses are liable to comply with all the applicable taxation regulations, including filing annual tax returns on their respective business incomes.
Taxation Experts @ Digital Filings can seamlessly assist businesses filing their obligatory annual business tax returns, enabling business owners to focus on their business critical matters.
Pocket-Friendly Options
Basic Package
1 Month GST FilingPackage Include:
GSTR-3B Return Filing- (Above price includes all taxes and relevant government fees.)
Standard Package
6 Months' GST FilingPackage Include:
- GSTR-3B Return Filing for 6 Months
- Quarterly GSTR-1 Return Filing (Above price includes all taxes and relevant government fees.)
Best Selling Package
12 Months' GST Filing- Package Include:
- GSTR-3B Return Filing for 12 Months
- Quarterly GSTR-1 Return Filing (+ all taxes and relevant government fees.)
How we Do It…
According to the pertinent Income Tax Act for Annual Business Return Tax Filing, an entity is bound to pay taxes on its annual Income following the prescribed procedure and keeping in mind the tax filing due dates. Partners @ Digital Filings can efficiently assist businesses in completing all taxation formalities within 5 to 7 business days.
These Facts and Figures are Important
Before filing the annual tax returns, an expert @ Digital Filings will coordinate with the business owners to assess and understand the required information regarding the entity’s financial performance in order to compute the precise taxable amount. On basis of the collected information, the Balance Sheet and Profit and Loss account of the business entity will be prepared and further shared with its finance department for verification purposes.
Penning on an Appropriate Forms
The relevant Income Tax Return (ITR) Forms to be filled depend on the very structure of the business. For instance, Domestic Company set-ups like, Private Limited, Public Limited, and One Person Companies are instructed to fill Form ITR-6, whereas Partnership and LLP firms are advised to submit Form ITR-5 to file their annual ITRs. Team @ Digital Filings will flawlessly comprehend your business structure and take the process further, accordingly.
Submitting Successfully
After gathering all the relevant information and documents as well as furnishing the financial statements and correctly computing the taxable amount, Partners @ Digital Filings will duly file the tax returns with the concerned taxation authority. Business will be notified on successful submission of the taxable returns.
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– Srinivasan
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– Hari
“Thank you Digital Filings for all your professional and timely support in getting my company registered.”
– Sachin Gupta
“I never thought it would be so easy to get my proprietorship firm registered. Thank you team Digital Filings. I will refer your proficient services to my friends too.”
– Pawan
“Thank you for simplifying the so complicated filing and documentation and getting my business smoothly registered.”
– Amit
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Why DigitalFilings
Easy Registration
Experts at Digital Filings can proficiently help in registering your sole proprietorship firm, either by getting you a GST / VAT Number, Service / Professional Tax Registration, a Shops & Establishments Act Registration, a Micro, Small & Medium Enterprises (MSME) Registration, or an Import-Export Code.
Supportive Team
The team of well-informed professionals at Digital Filings is just a phone call away to address every concern / query about the registration of your sole proprietorship venture. We will, however, put our best to make sure that all your questions are well-answered even before they strike in your mind.
Expert Support
Experts at Digital Filings precisely understand all of your requirements and strive to ensure that all the desired documents are in place so that you can effectively align yourself with every legal / administrative interaction. We will also provide you complete clarity on the process to set genuine expectations.