Corporater Taxation - Understanding

There are both Foreign Companies and Domestic Companies which are required to pay tax as per Income Tax Act, 1961:-

  • Domestic Company: Domestic Company is one which is registered under the Companies Act, 2013 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, 2013 and has control & management located outside India.

Tax Audit

Income tax act requires a class of companies having turnover as defined to get their accounts audited and submit a audit report to the Income Tax 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 September 30.

Tax Rates Applicable on Corporate

The tax rates applicable to the domestic companies for AY 2019-20 based on their turnover are as follows:

Particulars Tax Rate
Gross Turnover upto Rs. 250 Crore in FY 2016-17 25%
Gross Turnover exceeding Rs. 250 Crore 30%

The tax rates applicable to foreign companies for AY 2019-20 based on their turnover are as follows:

Particulars 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 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

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.

Minimum Alternate Tax (MAT)

Alternatively, all the companies (including foreign companies) are required to pay minimum alternate tax at the rate of 18.5 % on book profits if the tax calculated as per above rates are less than 18.5% of book profits.

ITR Forms To Be Filed In Case Of 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.

Form ITR 6

ITR Return Applicability Not Applicability
ITR 6 Form ITR 6 is applicable to companies. All the companies, except those who claim exemption as per Section 11 are required to file their returns in Form ITR 6. Companies that claim exemption under Section 11 are those companies that have income from property held for charitable or religious purpose. All the companies eligible to file ITR 6 need to file their returns electronically and sign through digital signature.

Form ITR 7

ITR Return Applicability Not Applicability
ITR 7 Persons who have to file their returns under Section 139(4A), 139(4B), 139(4D), 139(4E) or 139(4F) of the Income Tax Act, 1961 need to use form ITR 7. Following categories are required to furnish their return under aforesaid section.

Pricing

Normal

Starting at Rs.9,999 /- Onwards
  • Entities having turnover upto Rs.1 crore, Suggestions for compliance and internal control, Statutory audit under Companies Act, 2013.
  • ITR Filing

Standard

Starting at Rs.19,999 /- Onwards
  • Entities having turnover upto Rs.2 crore, Suggestions for compliance and internal control, Statutory audit under Companies Act, 2013 or Tax Audit u/s 44AB of the Income Tax Act, 1961

Executive

Starting at Rs.27,999 /- Onwards
  • Entities having turnover upto Rs.5 crore, Suggestions for compliance and internal control, Statutory audit under Companies Act, 2013 or Tax Audit u/s 44AB of the Income Tax Act, 1961

Start Here

Upload Documents

Upload Documents

Fill Form

Filling up form (for 10 percent additional discount)

Payment Gateway

Payment Gateway

Incorporation Process Initiate

Incorporation Process Initiate

Start Here

Upload Documents
Filling up form (for 10 percent
additional discount)
Payment gateway
Incorporation process initiate

Frequently Asked Questions

What is the last date for me for filing the business income return?

Last date for filing the business and profession income return is normally 31st July of the Assessment Year but if you are required to get your accounts audited, then last date for filing of return of income is 30th September of Assessment Year.

Do I need to maintain books of accounts?

If you are engaged in a specified profession, then you need to maintain the books of accounts if your gross receipts exceeds Rs. 1,50,000 in all the three years immediately preceding the previous year or if you are going to start a new business then gross receipts is likely to exceed Rs.1,50,000.

What does Specified Profession Include?

Specified Profession include legal, medical, engineering, architectural, accountancy, technical, interior decoration, film artists, company secretary, information technology and authorised representative profession.

When it is mandatory to get accounts audited?

You are required to get your accounts audited if your turnover or gross receipts exceeds Rs. 2 Cr. (in case of Business) and Rs. 50 lakhs (in case of profession).

If I do not opt for presumptive source of income though eligible, then what would be the consequences?

You have to maintain books of accounts and get your accounts audited if you do not opt for presumptive source of income, though eligible.