Corporate Tax Filing Guide

Filing of Income Tax Return- ITR6 By CMA S. VENKANNA COST ACCOUNTANT

Part I - Preparations Keep documents ready Registration with efiling website PAN and Password Balance Sheet Profit & Loss Account Schedules and Notes to BS P&L Computation Working Sheets Applicability of MAT Advance Tax Details TDS/TCS Details Certicates Download 26as

Basics of Corporate Tax Types of Companies Domestic as well as foreign companies are liable to pay corporate tax under the Income-tax Act. 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 companies can be defined as under : 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.

How to Proceed First Stage - Preparations for filing ITR6 Basic Requirements Status of Company Thorough Knowledge applicable provisions relating to Business/Profession Collection of information Prepare the data for filing Documents required

Second Stage - ITR-6 Visit Website : incometaxindiaefiling.gov.in Download the latest version of the form Filling the Form Check the details Generate xml file Filing through Digital Signature

Income of a Company Learn about the types of income which a company earns. Here it is : Profits earned from the business Capital Gains Income from renting property Income from other sources like dividend, interest etc.

Tax Rates AY 2020-21 Domestic Company 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%*

Foreign Company 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%

Surcharge 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

Cess Health & education Cess : Further 4% of income tax calculated and applicable surcharge will be added to the amount of total tax liability before this cess.

Tax Rate Reduced Rates of Tax Sec.115BA Tax Rate 25% With effect from assessment year 2017-18 that the domestic companies satisfy following conditions will eligible for tax rate of 25 per cent. Conditions: 1. The Assessee is a domestic company. 2. The company has been set-up and registered on or after 01.03.2016. 3. The company is not engaged in any business other than the business of manufacture or production of any article or thing. 4. Total income of the company is computed without claiming additional depreciation u/s.32 5. No adjustment of losses. Option in the Hands of Assessee: The company has an option to pay tax at the rate of 25%(+SC+EC+SHEC). This Option shall be exercised on or before the due date for furnishing the returns of income, which the company is required to furnish under the Act. Once the company has exercised the option for any previous year, it cannot be subsequently withdrawn for the same or any other previous year.

Section 115BAA Tax Rate 22% MAT Not applicable Deductions are not allowed No adjustment for losses Option to be exercised before the due date If once the option is exercised cannot be withdrawn for the same or subsequent assessment years. (With effect from AY 2020-21)

Section 115BAB Tax Rate 15% Any deduction under the provisions of section 10AA or clause (iia) of sub-section (1) of section 32 or section 32AD or section 33AB or section 33ABA or sub-clause (ii) or sub- clause (iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) or sub-section (2AB) of section 35 or section 35AD or section 35CCC or section 35CCD or under any provisions of Chapter VI-A under the heading C. Deductions in respect of certain incomes other than the provisions of section 80JJAA; set off of any loss carried forward or depreciation from any earlier assessment year, if such loss or depreciation is attributable to any of the deductions referred to above; set off of any loss or allowance for unabsorbed depreciation deemed so under section 72A, if such loss or depreciation is attributable to any of the deductions referred to above; and by claiming the depreciation, if any, under any provision of section 32, except clause (iia) of sub-section (1) of the said section, determined in such manner as may be prescribed. However, losses and depreciation would be deemed that full effect has already been given and no further deduction shall be allowed for any subsequent years.

Scheme of Business Deductions Section 30 to 37 Disallowances Section 40 Deemed Income Section 41 and 43 Books of Accounts Section 44AA Tax Audit Section 44AB Losses Section 70 to 74

MAT Section 115JB Steps Step I Computation of total income as per normal provisions of Income Tax Act 1961 Step 2 Calculation of Tax Liability at normal rates of tax at 30% plus surcharge plus education cess. Step 3 Computation of BOOK PROFIT as per Section 115JB Step 4 Calculation of Tax Liability on Book Profit at 15% plus surcharge plus Cess Step 5 Tax Payable Step 2 or Step 4 whichever is higher Step 6 Tax Credit Section 115JAA

Computation of Income Option I Computation of income under 4 heads separately When Company opts for normal tax at 30% Business income All Admissible Deductions Adjustment of Losses Net Income under Head Business GTI Deductions under Chapter VIA Net Income

Computation of Income Option II When the company opts for section 115BA tax at 25% 115BAA tax at 22% 115BAB tax at 15% Computation of Income without any deductions No adjustment for b/f losses

Tax Liability Normal Tax Liability at 30% plus S.C. Plus Cess Tax on Book Profit Sec.115JB 15% Plus S.C. plus cess Provisions of section 115JB is not applicable Companies availing benefit of lower tax rate under new provisions of sections 115BAA/ 115BAB have been Exempted from MAT on book profit under section 115JB

Due Dates AY 2020-21 Voluntary Return before the due date under section 139(1) 31stDecember 2020 When Tax Audit is not applicable 31stJanuary 2020 when Tax Audit is applicable Importance of filing the return before the due date (Sec.80) Carry forward of losses under the heads relating the current year House Property Business Capital Gains Belated Return After the due date but before 31stMarch 2021

Keep the documents ready Pan Card Balance Sheet duly certified by the auditors P & L Account Computation Sheet for the Income and Tax Liability Depreciation Calculation Schedule as per Sec.32 Details of Advance Tax Paid/Self Assessment Tax paid TDS Certificates Form No.16A/16B(Sale of property)/16C(Rent) TCS Certificates Form No.27C/27D Report under section 92E (if applicable) Form No.3CEB Downloaded Form No.26as from the Income Tax Website

Additional Documents GST Annual Return in Form No.GSTR-9 and GSTR9C Tax Audit Report under section 44AB

Schedules Latest Form ITR6 in the Income Tax Website contains 54 Schedules. The Schedules are divided into Part A and Part B Part A = Data Entry relating to Company Company Details Details of Income Deductions Exemptions Rebates Part B = Auto Calculation of Income and Tax Liability Total Income Tax Liability Tax Paid/Payable/Refund