A tax return is a list of income, expenses, and other relevant financial information. Business tax returns must be submitted annually and include supplemental TDS filings for businesses, just like personal tax returns must.
This form includes a statement of the earnings and costs. It includes information on fixed assets, loans received and disbursed, business debtors and creditors, and more.
More about Filing Tax Returns
Before we discuss corporate tax, let’s first gain a better understanding of the concept of a tax return in India.
Indian citizens are required to file income taxes if their Gross Total Income (GTI) exceeds Rs. 2.5 lakhs (a number below 2.5 lakhs is exempted).
Tax returns for each year must be filed before the deadline. Several income tax return forms are available for different categories of people based on various criteria. The Income Tax Department of India must locate and receive the proper forms in order to process the request. The benefits of filing income tax returns are numerous. Some of them are as follows:
What is Business Tax Return Filing
Businesses with an income of more than Rs. 1 crore are required to undergo a tax audit. For professionals with turnovers over Rs. 50 lakhs, a tax audit is also required. A tax audit consists of merely reviewing the tax return that was filed (for the aforementioned categories) to verify the accuracy of the claimed deductions and the income information. Chartered accountants audit these accounts and corporate tax returns.
Businesses with profits below 8%, or 6% for digital transactions, may be subject to tax audits. Professionals with less than 50% in receipts may also be subject to tax audits. To allow for the loss to be carried forward in circumstances of business losses, tax audits may also be conducted.
Who Is Required to File Business Tax Returns?
Tax returns must be filed by all eligible businesses that are subject to Indian tax laws. TDS (Tax Deducted at Source) returns and income tax returns are merged for certain firms. It is always preferred to pay taxes in advance in order to comply with the Income Tax Act.
Numerous tax filing service providers help businesses file GST returns among other things. The time needed to file a person’s business income tax return ranges from 3 to 5 working days.
It should be noted that the organisational setup of a firm has an impact on whether or not a tax return needs to be filed:
Businesses that operate as partnerships, limited liability companies, or sole proprietorships
Different Business Tax Return Formats
According to the types of business entities that are allowed to file them, i.e., the various business structures and their names, the various business tax return filing categories are assigned.
Filing a Sole proprietorship tax return filing
Partnership firm tax return filing
Tax returns for limited liability partnerships
While maintaining the flexibility of a partnership, this alternative corporate business form provides limited liability protections similar to those of a partnership. For taxation purposes, it is a flow-through entity.
In essence, this means that even while the company’s partners get untaxed profits, they still have personal tax obligations. Instead of conventional corporations, LLPs and Limited Liability Companies (a sort of corporate business in addition to a company’s limited liability) are preferred.
This is because the shareholders, who must pay taxes on distributions, are taxed separately from these corporations.
Filing of corporate tax returns
A corporation has the option of filing their business income tax return as either a local company or a foreign firm. Domestic businesses are those that have registered as Private Limited corporations, One Person Companies, or Company Limited with the Ministry of Corporate Affairs. A business that was founded in one state but operates in another is known as a foreign limited liability corporation, or LLC.
Benefits of Filing with Dailyfiling
You won’t have to stress about remembering when things are due because we will remind you.
a straightforward method for keeping track of and archiving your bills and other paperwork.
You can file your returns, get the appropriate input tax credit, and save money by working with experts.
Understand the GST legislation and procedures because our experts submit returns for many other companies just like yours and stay current on any changes.
Save a tonne of time and labour because your file is error-free, and we will pay any penalty related to any erroneous delay on our part.
The duties listed above are some of the most crucial tax and compliance obligations that a company cannot afford to neglect. I hope you complete everything on schedule and adhere to the law.
Please get in touch with dailyfiling if you need help or professional guidance managing your tax and compliance duties.
We have a group of attorneys on staff who can help you manage and plan your taxes effectively.
In addition, dailyfiling provides a range of tax compliance, GST advisory, and management services. What are you waiting for then? Join forces with us to make sure that your company is always within the law.