Apply for Business Tax Return

Business Tax Return

A corporate is an entity that has a separate and independent legal entity from its shareholders. Domestic as well as foreign companies are liable to pay corporate tax under the Income-tax Act. While a domestic company is taxed on its universal income, a foreign company is only taxed on the income earned within India i.e. is being accrued or received in India.

Types of Comapny

Domestic Company

Domestic company is one which is registered under the Companies Act of India and also includes the company registered in the foreign countries having control and management wholly situated in India. A domestic company includes private as well as public companies.

Foreign Company

Foreign company is one which is not registered under the companies act of India and has control & management located outside India.

Types of Income of a Company

Point - 1

Profits earned from the Business

Point - 2

Capital Gains

Point - 3

Income from renting property

Point - 4

Income from other sources like dividend, interest etc.

Tax Rates Applicable

Domestic Companies

Sections Tax rate Surcharge
Section 115BA (Companies having turnover up to Rs 400 crore in FY 2017-18) 25% 7%/12%*
Section 115BAA 22% 10%
Section 115BAB 15% 10%
Any other case 30% 7%/12%*

*Plus surcharge in case a company gets taxed under section 115BA. The rate of surcharge is 7% in case the total income is above one crore rupees and up to Rs 10 crore. The surcharge is 12% in case total income is above Rs 10 crore. However, if a company opts for taxation under section 115BAA or section 115BAB, the surcharge is 10% irrespective of the total income.

Foreign Companies

The following rates are applicable to foreign companies for AY 2020-21 based on their turnover :

Nature of Income Tax Rate
Royalty received or fees for technical services from government or any indian concern under an agreement made before April 1, 1976 and  approved by central government 50%
Any other income 40%

 

In addition to above rates :

Surcharge rate :

Particulars Tax Rate
If total income exceeds Rs. 1 crore but not Rs. 10 Crore 7% of tax calculated on domestic company/ 2 % of tax calculated on foreign company as per above rates
If total income exceeds Rs. 10 crore 12% of tax calculated on domestic company/ 5 % of tax calculated on foreign company as per above rates

Minimum Alternate Tax (MAT)

Alternatively, all the companies (including foreign companies) are required to pay minimum alternate tax at the rate of 15% on book profits if the tax calculated as per above rates are less than 15% of book profits. This will be applicable if the company does not opt for Section 115BAA or Section 115BAB.

Everything about filing income tax return

Due date for filing Income tax return

Companies including foreign companies have to file their income tax return on or before 30 October every year. Even if the company came into existence during the same financial year, then too, it has to file the income tax return for that period on or before 31 October. For FY 2019-2020 (AY 2020-21), the due date has been extended to 30 November 2020, due to the pandemic.

Tax return forms to be filed by the company

ITR 6 : All the companies except companies claiming deduction under section 11 need to file their return using Form ITR 6.
ITR 7 : All the companies registered under section 8 of companies act, 2013 are required to file their return using Form ITR 7.

Tax Audit

Income tax act requires a class of companies to get their accounts audited and submit a audit report to the IT department along with the Income tax return. This audit is known as Tax Audit. This tax audit report is also required to be mandatorily submitted by eligible companies by 30 September. However, for FY 2019-20 (AY 2020-21), the due date for submitting the tax audit report is 31 October 2020.

FAQ

  • If you are getting income from business, salary, other income such as rent. You have to pay for this return.
  • If your total income is above from the basic taxable limit, you have to pay this tax.

Here are a few documents required for filing return:

  • Form-16.
  • Salary slips.
  • Form 16A, 16B, 16C
  • Form 26AS
  • Tax saving investment proof
  • Adhar card and Pan Card.
  • Copy of registered fir, or business

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