In the game of life, your success is measured in numbers, figures in your bank account and annual earnings reflected in your tax return. These numbers have the potential to either open doors, create opportunities for development and growth, or close doors.
Business owners and professionals will find an opportunity to strike more frequently, by filing their annual tax returns. The filing of your income tax return is not only to state your earnings to the Income Tax Department and pay taxes owing, but it allows you to avail of other aids that can be beneficial for you in the short and long-term future.
Online Income Tax Return File for business is essentially the process by which a business must report its income and expenses to the Income Tax Department. All companies operating in India, large and small, must file tax returns annually. Business income tax is more complicated than personal income tax.
A business tax return is nothing but a statement of the business's earned income and expenses. If the business is showing profits, the tax should be paid on the profits. In addition to filing tax returns, a business may also be required to file TDS or pay tax in advance, depending on the need. Tax returns filed by a business will also include details on the assets and liabilities of a business.
In India, it is mandatory to file an income tax return if the income is above the basic exemption limit. Income tax slabs are pre-determined by the government. Delays in filing returns can attract a penalty. According to the Income Tax Act, Income tax is to be paid by Individuals, companies, associations or persons, etc who fall within certain income brackets.
Who Should opt Online Income Tax Return File?
According to the Income Tax Act, Income tax is to be paid by Individuals, companies, associations and persons, etc who fall within certain income brackets. Mentioned below are the entities and organizations that are required to file the ITRs:
- Every individual, up to the age of 59, whose total income for a financial year exceeds Rs. 2.5 lakhs
- For every Senior citizen between the age of 60 and 80, their tax exemption limit increases to Rs. 3 lakhs
- For every Super Senior Citizen aged 80 and above, their tax exemption limit increases to Rs. 5 lakhs.
Note: It is important to note the income should be calculated before allowing any deduction under Section 80C to 80U and other exemptions under section 10.
- All companies generate income, irrespective of whether they’ve made any profit or not through the year.
- Those who want to claim a refund on the excess tax deducted
- Individuals who have assets that are located outside of India
- Foreign Companies
- NRIs who earn more than Rs. 2.5 lakh in India in a particular financial year
Tax Rates
HUF opting for a Normal Tax Regime
Hindu Undivided Family (HUF) |
Net-Income Range |
Rate of Income TaxAssessment Year 2022-23 |
Up to Rs. 2.5 lakhs |
- |
Rs. 2.5 lakhs to Rs. 5 lakhs |
5% |
Rs. 5 lakhs to Rs. 10 lakhs |
20% |
Above Rs. 10 lakhs |
30% |
HUF opting for an Alternate Tax Regime
Net-Income Range |
Rate of Income TaxAssessment Year 2022-23 |
Up to Rs. 2.5 lakhs |
- |
Rs. 2.5 lakhs to Rs. 5 lakhs |
5% |
Rs. 5 lakhs to Rs. 7.5 lakhs |
10% |
Rs. 7.5 lakhs to Rs. 10 lakhs |
15% |
Rs. 10 lakhs to Rs. 12.5 lakhs |
20% |
Rs. 12.5 lakhs to Rs. 15 lakhs |
25% |
Above Rs. 15 lakhs |
30% |
Note:
Rebate under section 87A is available to resident individuals whose total income does not exceed Rs. 5 lakhs during the previous year.
Rebate is available to the extent of Rs. 12,500 and no rebate will be available if total income exceeds Rs 5 lakhs.
Tax Rates for AOP/BOI
Net-Income Range |
Rate of Income TaxAssessment Year 2022-23 |
Up to Rs. 2.5 lakhs |
- |
Rs. 2.5 lakhs to Rs. 5 lakhs |
5% |
Rs. 5 lakhs to Rs. 10 lakhs |
20% |
Above Rs. 10 lakhs |
30% |
Tax Rates for Company
Particulars |
Rate of Income TaxAssessment Year 2022-23 |
Domestic Company opting for Section 115 BAB |
Income from the manufacture or production of an article or thing |
15% |
Income from non-manufacturing activities (if no specific rate is prescribed) |
22% |
Short-term capital gains (from the transfer of depreciable assets) |
15% |
Short-term capital gains (from the transfer of non-depreciable assets) |
22% |
Excess profit added by the Assessing officer under section 115BAB (6) owning to close connection between the company and another person |
30% |
Other Domestic Company |
Total turnover/gross receipt during the previous year 2019-20 does not exceed Rs. 400 crores |
25% |
Total turnover/gross receipt during the previous year 2020-21 does not exceed Rs. 400 crores |
NA |
The company opted for Section 115BA |
25% |
The company opted for Section 115 BAA |
22% |
Any other domestic company |
30% |
Foreign Company |
In General |
40% |
Tax Rates for Cooperative Society
Net-Income Range |
Rate of Income TaxAssessment Year 2022-23 |
Opting for section 115 BAD |
22% |
Other Co-operative Society |
Up to Rs. 10,000 |
10% |
Rs. 10,001 to Rs. 20,000 |
20% |
Above Rs. 20,000 |
30% |
Tax Rates for Other Entities
Particulars |
Rate of Income TaxAssessment Year 2022-23 |
Firms |
30% |
Local Authority |
30% |
Due Date for Filing Income Tax Return
Class of assets |
F.Y 21-22 (A.Y. 22-23) |
Individual & HUF |
Non-Audit Cases (Individuals, professionals, small businesses, etc.)
[ITR-1, ITR-2 or ITR-4 sugam] |
31st July 2022 |
Working Partner of a Firm or LLP whose audit is required u/s 44AB (ITR-2) |
31st October 2022 |
Non-Working Partner |
31st July 2022 |
Audit Cases
[ITR-3] |
31st October 2022
(Audit report is required to be filed by 30th September 2022)
|
Firm, LLP, AOP, BOI, AJP, Local Authority, Co-operative society |
Audit Cases
[ITR-5] |
31st October 2022
(Audit report is required to be filed by 30th September 2022) |
Non-audit cases
[ITR-5] |
31st July 2022 |
Company |
All Companies [ITR-6] |
31st October 2022
(Audit report is required to be filed by 30th September 2022) |
Trusts, colleges, political parties |
Trusts, colleges, political parties, etc. who are required to file their return u/s 139(4A), 139(4B), 139(4C), or 139(4D)
[ITR-7] |
31st October 2022
(Audit report is required to be filed by 30th September 2022) |
|
If not required to get its accounts audited |
31st July 2022 |
Report being filed u/s 92E |
|
31st October 2022
(Audit report is required to be filed by 30th September 2022) |
Furnishing of Income Tax Return in case of Transfer Pricing |
|
30TH November 2022 |
Revised Return |
|
31st December 2022 |
Belated/Late Return |
|
31st December 2022 |
Interest and Penalty for delay in filing returns
Interest |
Taxpayers who do not file returns within the due date – 1% per month or part of a month on the tax amount that is unpaid |
Penalty |
When total income exceeds INR 5 lakhs – Rs. 5000Any other case – Rs. 1000 |
Rates of Surcharge
A. Rate of Surcharge in the hands of the Individual, HUF, AOP (Except AOP with all members as a company), BOI or AJP
Nature of Income |
Assessment Year 2022-23 |
Up to Rs. 50 lakhs |
More than Rs. 50 lakhs but up to Rs. 1 crore |
More than Rs. 1 crore but up to Rs. 2 crore |
More than Rs. 2 crores but up to Rs. 5 crores |
More than Rs. 5 crores |
Short-term capital gain is covered under Section 111A |
Nil |
10% |
15% |
15% |
15% |
Long-term capital gain is covered under Section 112A |
Nil |
10% |
15% |
15% |
15% |
Long-term capital gain is covered under Section 112 |
Nil |
10% |
15% |
25% |
37% |
Dividend income |
Nil |
10% |
15% |
15% |
15% |
Unexplained income chargeable to tax under Section 115BBE |
25% |
25% |
25% |
25% |
25% |
Any other income* |
Nil |
10% |
15% |
25% |
37% |
B. Rate of Surcharge in case of any other Assessee
Taxpayer |
Range of Income |
Assessment Year 2022-23 |
|
Up to Rs. 1 Crore |
More than 1 crore to Rs. 10 crore |
Exceeding Rs. 10 crores |
Firm/ Local Authority |
- |
12% |
12% |
Domestic Company |
10% |
10% |
10% |
Opting for Section 115 BAA or 115BAB |
|
|
|
Other Domestic Company |
- |
7% |
12% |
Foreign Company |
- |
2% |
5% |
Co-operative Societies opting for section 115BAD |
10% |
10% |
10% |
Other co-operative societies |
- |
12% |
12% |
Note:
Health and Education Cess at the rate of 4% shall be charged on the aggregate of income-tax and surcharge.
ITR RETURNS
Sr. No. |
Type of Return |
Purpose |
1. |
ITR-3 |
By individuals and HUFs who make an income from a profession or a proprietorship business. Income generated from:Profession or BusinessInvestment in equity shares that were unlisted at any time during the financial year.Individual Partner in a firmIndividual as a Director of a CompanyPension or Salary, House Property, or any other source of IncomeIf Business turnover exceeds Rs. 2 crores |
2. |
ITR-4 or Sugam |
Can be filed by HUFs, Partnership Firms, and individuals who are Indian residents who generate an income from a profession or business. Individuals who have chosen the presumptive income scheme according to Section 44AD, Section 44ADA, and Section 44AE of the Income Tax Act 1961. |
3. |
ITR-5 |
Filed by Investment funds, Business trusts, Estates of insolvent, Estates of deceased, Artificial Juridical persons (AJP), Body of Individuals (BOIs), Associations of Persons (AOPs), LLPs, and firms. |
4. |
ITR-6 |
Can be filed by any companies that are not claiming exemptions under Section 11, Companies that are filing returns under this section can only do it electronically. |
5. |
ITR-7 |
Can be filed by Individuals and companies that have furnished returns under Section 139(4A), Section 139(4B), Section 139(4C), Section 139(4D), Section 139(4E), or Section 139(4F) |
Online Income Tax Return File
The income Tax Portal is an independent portal launched by the income tax department. One can go to https://www.incometax.gov.in/iec/foportal if one wants to file ITR electronically/ online.
Steps to file Income Tax Return Online
There are a few simple steps that one can follow to file the Income Tax Return online.
1. Go to https://www.incometax.gov.in/iec/foportal
2. You can Register on the portal using your PAN. Those who are already registered click on ‘Login’
3. Direct to e-file and click on ‘Income Tax Returns
4. From the menu select ‘File Income Tax Return’
5. Choose the ITR form and Assessment Year.
6. Select ‘Original/ Revised Return’
7. Then click on ‘Prepare and Submit Online
8. Fill in the essential details asked in the ITR form
9. Calculate ‘tax payable’
10. Click on ‘Preview and Submit
11. Complete the verification by sending the Aadhar OTP
12. Enter the OTP sent to the registered mobile number and then submit
Income Tax Audit
The Department of Income Tax provided for a tax audit according to section 44AB of the 1961 Income Tax Act. The purpose of an income tax audit is that an organization’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 compulsory, and all taxpayers have to get the accounts of their organization or business audited as per the provisions of Section 44AB of the Income Tax Act.
There are many purposes for an income tax audit. It ensures that all businesses keep proper books of accounts and other records of expenses and income. A tax audit also ensures that total income and deduction claims are properly entered when filing returns. This minimizes the risk of fraud.
The tax audit applies to certain groups of companies. If an owner manages a company and the turnover exceeds Rs 1 crore, a tax audit is compulsory. LLPs with a yearly turnover of more than Rs 40 lakh or a capital contribution of Rs 15 lakh must get their accounts audited by a chartered accountant. All kinds of businesses, whether it's limited companies or sole proprietorships, have to go through a tax audit, no matter what the annual turnover is.