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Private Limited Company Income Tax Return Online

Private Limited Company is the most popular form of starting a business, there are various compliances which are required to be followed once your business is incorporated.Mandatory compliances like declaration of commencement of Business, Annual return, Board meetings, annual general meeting and others.Private Limited Company is required to make various legal and tax related filings as par Companies Act and Income Tax Act every year mandatory, even Private Limited Companies having zero turnover are required to file its Income Tax Return to Income Tax Department

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How to file Private Limited Company Income tax return online
The compliance requirements are complex Call CA helps you to filing these compliances in three easy steps :
Understanding the annual compliance

We help you to understand the compliance for Income Tax you need to comply and the documents to submit

Step 2 Submission of Requisite Documents

Our team of professionals prepare the necessary data and guides you for ITR status and upload the ITR Return with EVC or DSC

Step 3 Filing of Return and Reporting

Our Income tax team will file the return and share you the acknowledgement. We also provide the Computation report that enables you for better and transparent understanding of your ITR

Overview & Concept

Private Limited companies are required to compulsorily file their annual return of income and financial statement with ROC and tax department every year on or before the due date to avoid penalty.If its required to be audited under section 44AB of income tax act, then in addition to its return of income, audit report in form 3CA and statement of particulars in form 3CD has to be uploaded online with tax department. According to Section 139 of Income tax act 1961, a private limited company is required to file its return of income on or before 30th September each year. However, if transfer pricing provisions are applicable then due date for income tax filing will be considered as 30th November instead of 30th September. In cases where tax audit under section 44AB is applicable, the company is required to file tax audit report in 3CA and statement of particulars in form 3CD along with return of income. If a private limited company fails to file its return of income, then in addition to other applicable sections, interest as per section 234A will be charged at the rate of 1% per month or part of the month on the outstanding tax liability.

What is a Tax Residential Status of a Company ?

With effect from Assessment Year 2017-18, a company is said to be resident in India in any previous year, if:

(i) it is an Indian company; or

(ii) its place of effective management, at any time in that year, is in India.

For this purpose, the “place of effective management” means a place where key management and commercial decisions that are necessary for the conduct of the business of an entity as a whole are, in substance made.The concept of POEM is effective from Assessment Year 2017-18. The CBDT has issued the final guidelines for determination of POEM of a foreign company.The final guidelines on POEM contain some unique features. One of the unique features is test of Active Business Outside India (ABOI). The guidelines prescribe that a company shall be said to engaged in 'active business outside India' if passive income is not more than 50% of its total income. Further, there are certain additional cumulative conditions to be satisfied regarding location of total assets, employees and payroll expenses.The place of effective management in case of a company engaged in active business outside India shall be presumed to be outside India if the majority meetings of the board of directors of the company are held outside India.

In cases of companies other than those that are engaged in active business outside India, the determination of POEM would be a two stage process, namely:—

First stage would be identification or ascertaining the person or persons who actually make the key management and commercial decision for conduct of the company's business as a whole.
Second stage would be determination of place where these decisions are in fact being made.owever, it has been provided that the POEM guidelines shall not apply to a company having turnover or gross receipts of INR 50 crores or less in a financial year

Tax Rates Applicable on a Company

Income-tax rates applicable in case of domestic companies for assessment year 2020-21 and 2021-22 are as follows:

 Domestic Company     
                                                                                     Assessment Year 2020-21    Assessment Year 2021-22
♦ Where its total turnover or gross receipt during   the
    previous year 2017-18 does not exceed Rs. 400 crore                       25%                                          NA
♦ Where its total turnover or gross receipt during the
    previous year 2018-19 does not exceed Rs. 400 crore                        NA                                          25%
♦ Any other domestic company                                                              30%                                         30%


Add: (a) Surcharge : The amount of income-tax shall be increased by a surcharge at the rate of 7% of such tax, where total income exceeds one crore rupees but not exceeding ten crore rupees and at the rate of 12% of such tax, where total income exceeds ten crore rupees. The surcharge shall be subject to marginal relief, which shall be as under:

 (i)  Where income exceeds Rs. 1 crore but not exceeding Rs. 10 crore, the total amount payable as income-tax and surcharge shall not exceed total amount payable as income-tax on total income of Rs. 1 crore by more than the amount of income that exceeds Rs. 1 crore.

 (ii)  Where income exceeds Rs. 10 crore, the total amount payable as income-tax and surcharge shall not exceed total amount payable as income-tax on total income of Rs. 10 crore by more than the amount of income that exceeds Rs. 10 crore

(b) Health and Education Cess : The amount of income-tax and the applicable surcharge, shall be further increased by health and education cess calculated at the rate of four percent of such income-tax and surcharge.

1. Special Tax rates applicable to a domestic company

The special Income-tax rates applicable in case of domestic companies for assessment year 2020-21 and 2021-22 are as follows:

Domestic Company     
                                                                         Assessment Year 2020-21    Assessment Year 2021-22
♦ Where it opted for section 115BA                               25%                                   25%
♦ Where it opted for Section 115BAA                            22%                                   22%
♦ Where it opted for Section 115BAB                            15%                                   15%
Surcharge : The rate of surcharge in case of a company opting for taxability under Section 115BAA or Section 115BAB shall be flat 10% irrespective of amount of total income.

Health and Education Cess: The amount of income-tax and the applicable surcharge, shall be further increased by health and education cess calculated at the rate of four percent of such income-tax and surcharge.

MAT (Minimum Alternate Tax): The domestic company who has opted for special taxation regime under Section 115BAA & 115BAB is exempted from provision of MAT. However, no exemption is available in case where section 115BA has been opted.

In that case, the provisions of Minimum Alternate Tax (MAT) applies, tax payable cannot be less than 15% (+HEC) of "Book profit" computed as per section 115JB. However, MAT is levied at the rate of 9% (plus surcharge and cess as applicable) in case of a company, being a unit of an International Financial Services Centre and deriving its income solely in convertible foreign exchange. 

ITR Form Applicable on Company

Company (Private or Public Limited)  are required to file income tax return in form ITR 7. Like all other income tax forms, ITR 7 is an attachment less form and there is no requirement for submitting any documents or statements along with a companies  tax return. However, the taxpayer must save all records pertaining to the business and produce the same before tax authorities when requested.

What are the Due Dates for Filing of ITR ?

Private limited companies registered in India must file Income Tax Return on or before 30th September 2020 for the FY2019-20. Failure to file income tax return attracts a penalty of Rs.10,000.

Tax Audit for Company

The Income Tax Department has made provisions for tax audit under Section 44AB of the Income Tax Act 1961. The purpose of an income tax audit is that an individual or organisation’s taxes are examined by an external agency to check that all the information regarding income, expenditure and deduction has been filed correctly. Income Tax Audit has been made mandatory, and all taxpayers have to get the accounts of their business or organisation audited as per as the provisions of Section 44AB of the Income Tax Act.

An Income Tax audit has several objectives. It ensures that all businesses maintain a proper book of accounts and other expense and revenue records in a proper manner. A tax audit also ensures that the total income and claims for deduction are correctly entered when filing the returns. This brings down chances of fraud.

​​​As per section 44AB, following persons are compulsorily required to get their accounts audited :

• A person carrying on business, if his total sales, turnover or gross receipts (as the case may be) in business for the year exceed or exceeds Rs. 1 crore. This provision is​ not applicable to the person, who opts for presumptive taxation scheme under section 44AD​ and his total sales or turnover doesn't exceeds Rs. 2 crores.

Note: w.e.f. Assessment Year 2020-21, the threshold limit, for a person carrying on business, is increased from Rs. 1 Crore to Rs. 5 crore in case when cash receipt and payment made during the year does not exceed 5% of total receipt or payment, as the case may be. In other words, more than 95% of the business transactions should be done through banking channels.

Why Call CA

We get your Income tax return  done with complete online support. You need not to step outside your home and we guide you to enter into the business world hasselfree. At Call CA , our team helps you to understand the concept of ITR filing and help you to arrange the right documention done for the ITR Filings . Call CA has a TAT for ITR  is 5 working day

FAQs

Penalty of non filing or delay in filing tax audit report

If any taxpayer who is required to get the tax audit done but fails to do so, the least of the following may be levied as a penalty: 1. 0.5% of the total sales, turnover or gross receipts 2. Rs 1,50,000

What constitutes Audit report?

Tax auditor shall furnish his report in a prescribed form which could be either Form 3CA or Form 3CB where: Form No. 3CA is furnished when a person carrying on business or profession is already mandated to get his accounts audited under any other law. Form No. 3CB is furnished when a person carrying on business or profession is not required to get his accounts audited under any other law. In case of either of the aforementioned audit reports, tax auditor must furnish the prescribed particulars in Form No. 3CD, which forms part of audit report.

What happens if a person is required to get his accounts audited under any other law for eg. statutory audit of companies under company law provisions ?

In such cases, the taxpayer need not get his accounts audited again for income tax purposes. It is sufficient if accounts are audited under such other law before the due date of filing the return. The taxpayer can furnish this prescribed audit report under Income tax law.

What is the due date for Tax Audit ?

A person covered by section 44AB should get his accounts audited and should obtain the audit report on or before 30th September of the relevant assessment year, e.g., Tax audit report for the financial year 2019-20 corresponding to the assessment year 2020-21 should be obtained on or before 30th September, 2020. ​The tax audit report is to be electronically filed by the chartered accountant to the Income-tax Department. After filing of report by the chartered accountant, the taxpayer has to approve the report from his e-fling account with Income-tax Department .

What is the penalty not maintaining of books of accounts ?

​According to section 271B, if any person who is required to comply with section 44AB fails to get his accounts audited in respect of any year or years as required under section 44AB or furnish such report as required under section 44AB​, the Assessing Officer may impose a penalty. The penalty shall be lower of the following amounts: (a) 0.5% of the total sales, turnover or gross receipts, as the case may be, in business, or of the gross receipts in profession, in such year or years. (b) Rs. 1,50,000. However, according to section 271B​, no penalty shall be imposed if reasonable cause for such failure is proved.

What are the Objectives of Tax Audit ?

One of the objectives of tax audit is to ascertain/derive/report the requirements of Form Nos. 3CA/3CB and 3CD. Apart from reporting requirements of Form Nos. 3CA/3CB and 3CD, a proper audit for tax purposes would ensure that the books of account and other records are properly maintained, that they truly reflect the income of the taxpayer and claims for deduction are correctly made by him. Such audit would also help in checking fraudulent practices. It can also facilitate the administration of tax laws by a proper presentation of accounts before the tax authorities and considerably save the time of Assessing Officers in carrying out routine verification, like checking correctness of totals and verifying whether purchases and sales are properly vouched for or not. The time of the Assessing Officers saved could be utilized for attending to more important and investigation aspects of a case.​

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