One of your primary obligations if you run an Indian company is to annually file a corporate tax return. This keeps your business orderly and open in addition to being a legal need. Although many company owners first find the process perplexing, it becomes rather simple with the correct knowledge. We will define a corporate tax return, who needs to file it, and walk step-by-step on how to do it in this blog.
Describe a Corporate Tax Return
The annual statement a company turns in to the Income Tax Department is called a corporate tax return. It displays for the year the company’s overall income, expenses, taxes paid, and other financial information. This helps the government determine whether or not your business paid the right tax due.
Companies file corporate tax returns using different sets of guidelines and forms, much as individuals file personal tax returns.
Who Needs to Submit?
Every company in India, regardless of size, has to submit a corporate tax return:
- Private limited companies
- Public limited companies
- Foreign businesses doing business in India
- One-Person Companies
- Even businesses with zero loss or income
Whether or not your business turned a profit matters—filing is required.
Due Dates We Should Not Forget
Whether your business requires a tax audit will determine the due date for your corporate tax return:
- With audit: October 31, the assessment year
- Regarding foreign business: November 30
- Without an audit: Rare for businesses, but due earlier if relevant
Late filing could result in fines, thus it is advisable to file on time.
Procedures for Preparing Financial Statements and Filing a Corporate Tax Return
- A balance sheet
- Profit and loss statement
- Statements of cash flow
If necessary, a chartered accountant should audit these.
Determine Tax Obligation
Apply current business tax rates depending on the type of your business. Look for exemptions or deduction possibilities.
Pay Advance Taxes
Should your annual total tax be more than ₹10,000, you have to pay advance tax in installments.
Online File ITR-6 Form
Most businesses have to submit ITR-6 (except from those claiming Section 11 exemptions). File it using a digital signature on the official income tax portal.
Check Compliance
Verify the return with your Digital Signature Certificate (DSC). Companies have to do this.
Advantages of Organising Corporate Tax Returns
- Steer clear of punishments: Late filing draws fines and interest.
- For commercial loans, banks sometimes demand tax returns.
- Filing reveals whether your business complies with tax regulations legally.
- Clear financial records facilitate tracking of income and expansion of your business.
Typical Errors to Prevent
- Incorrect Form Filing
- Not including every source of income
- Ignoring tax audits as necessary
- Wrong tax computation
- Missing the deadline
Last Thoughts
Every Indian company owner has a major duty in filing a corporate tax return. Although at first, it may seem difficult, the process is straightforward with correct records and assistance from an accountant or tax consultant. Maintaining your business tax-compliant, staying current, and filing on time will help you show a competent and successful business.