Partnership

Partnership firms (registered or unregistered) are required to file an income tax return in form ITR 5 each year. Partnership firms attract income tax at the rate of 30%. Tracequality offers income tax filing for partnership firms from Rs.5899

 LLP

Limited Liability Partnership firms registered in India are required to file Income Tax Returns in Form ITR-5 each year and MCA Annual Return. Tracequality offers comprehensive compliance management for LLPs starting from Rs.7899

Companies

All types of companies registered in India are required to file Income Tax Returns in Form ITR-6 each year and MCA Annual Return. Tracequality offers comprehensive compliance management for companies starting from Rs.7899

Proprietorship Tax Return Filing

Any individual who has business income is said to be operating a proprietorship firm. Proprietorships operating in India are required to file an income tax return each year. Since proprietorships are considered to be the same as the proprietor, the income tax return filing procedure for a proprietorship is similar to individual income tax return filing.

Requirement for Filing Proprietorship Tax Return

All proprietors below the age of 60 years are required to file an income tax return if their total income exceeds Rs. 2.5 lakhs. In the case of proprietors over the age of 60 years but below 80 years, income tax filing is mandatory if the total income exceeds Rs.3 lakhs. Proprietors over the age of 80 years and above are required to file an income tax return if the total income exceeds Rs.5 lakhs.

Income Tax Rate for Proprietorship

The income tax rate for a proprietorship is the same as the income tax rate for individuals. Unlike the income tax rate for LLP or Company which are flat rates, proprietorships are taxed on slab rates. The following is the income tax rate applicable for proprietorships for the assessment year 2019-20, wherein the age of the proprietor is less than 60.

Tax Audit for Proprietorship

An audit would be required for a proprietorship firm if the total sales turnover is over Rs.1 crore during the financial year. In the case of a professional, an audit would be required if total gross receipts are more than Rs.50 lakhs during the financial year under assessment.

 Due Date for Filing Proprietorship Tax Return

The income tax return of a proprietorship that doesn’t require an audit is due on 31st July. In case the income tax return of a proprietorship needs to be audited as per Income Tax Act, then the return would be due on 30th September.

Tax Return for Proprietorships

For the assessment year 2017-18 only, which relates to income earned in Financial Year 2016- 17, proprietorship firms would be required to file Form ITR-3 or Form ITR-4-Sugam. Form ITR-3 can be filed by a proprietor or a Hindu Undivided Family who is carrying out a proprietary business or profession. Form ITR-4-Sugam can be filed by a proprietor who would like to pay income tax under the presumptive taxation scheme.