🏢 Company Income Tax Return (ITR) – Complete Guide (India)

1️⃣ What is Company Income Tax Return?

A Company Income Tax Return (ITR) is a statutory filing submitted annually to the Income Tax Department of India, declaring:

• Total income earned by the company

• Taxable profits

• Taxes paid (TDS, advance tax, self-assessment tax)

• Deductions, exemptions, and losses

• Audit details (if applicable)

Governing Law: Income Tax Act, 1961

2️⃣ Which Companies Must File ITR?

Mandatory for ALL companies, irrespective of:

• Profit or loss

• Turnover

• Business activity

• Dormant or inactive status

Types of Companies Covered:

• Private Limited Company

• Public Limited Company

• One Person Company (OPC)

• Section 8 (Non-Profit) Company

• Foreign Company (having income in India)

⚠️ Even loss-making or dormant companies must file ITR.

3️⃣ Applicable ITR Forms for Companies

4️⃣ Corporate Tax Rates (FY 2025–26 indicative)

Domestic Companies

Companies opting 115BAA/115BAB must forgo exemptions & deductions.

5️⃣ Income Heads for Companies

1. Income from Business / Profession

2. Capital Gains

3. Income from House Property

4. Income from Other Sources

5. Foreign Income (if applicable)

6️⃣ Deductions & Allowable Expenses

Business Expenses (Sections 30–37)

• Employee salaries & benefits

• Rent, electricity, internet

• Professional & legal fees

• Repairs & maintenance

• Advertisement & marketing

• Insurance & statutory payments

Depreciation

• As per Income Tax Act rates (WDV method)

• Separate from Companies Act depreciation

Other Allowable Deductions

• Bad debts written off

• Interest on loans

• CSR expenses (restricted)

7️⃣ Tax Audit for Companies

Mandatory Audit:

• ALL companies must be audited, irrespective of turnover

Audit Forms:

• Form 3CA – Audit under Companies Act

• Form 3CD – Tax Audit Report (Clause-wise disclosure)

Audit Due Date:

• 30th September of Assessment Year

8️⃣ Minimum Alternate Tax (MAT)

• Applicable under Section 115JB

• MAT Rate: 15% of book profits

• MAT credit can be carried forward for 15 years

• Not applicable to companies under 115BAA / 115BAB

9️⃣ Documents Required for Company ITR

🔟 Step-by-Step Company ITR Filing Process

Step 1: Prepare Financial Statements

• P&L Account

• Balance Sheet

• Notes & schedules

Step 2: Conduct Statutory & Tax Audit

• File Form 3CA + 3CD

Step 3: Compute Tax Liability

• Normal tax or MAT

• Adjust advance tax & TDS

Step 4: File ITR-6 Online

• Through Income Tax e-Filing Portal

Step 5: Verify ITR

• Digital Signature (DSC mandatory)

Step 6: Assessment & Refund

• CPC processing

• Refund (if any) credited to bank

1️⃣1️⃣ Advance Tax for Companies

• Mandatory if tax liability > ₹10,000

• Paid in 4 installments

• Interest under Sections 234B & 234C for defaults

1️⃣2️⃣ Loss Carry Forward Rules

❗ ITR must be filed before due date to carry forward losses.

1️⃣3️⃣ Penalties for Non-Compliance

1️⃣4️⃣ Common Mistakes by Companies

• Not matching GST & ITR turnover

• Ignoring MAT applicability

• Late audit filing

• Incorrect depreciation rates

• TDS mismatch with Form 26AS

• Non-disclosure of foreign income

1️⃣5️⃣ Special Situations

• Startup Companies – Tax holiday under Section 80-IAC

• Foreign Companies – DTAA benefits

• Section 8 Companies – ITR-7 filing

• Dormant Companies – Filing still mandatory

1️⃣6️⃣ Advisory Draft – Company Income Tax Return

Email

SUBJECT: Advisory on Company Income Tax Return Filing

To: [Client Name]
Date: __________

Dear Sir / Madam,

This is to inform you regarding the mandatory filing of Income Tax Return (ITR-6) for your company for Financial Year [20XX–XX].

Scope of Compliance:

1. Preparation and review of audited financial statements

2. Conduct of statutory and tax audit (Form 3CA & 3CD)

3. Computation of tax liability / MAT, if applicable

4. Adjustment of TDS, advance tax, and MAT credit

5. Online filing of ITR-6 using Digital Signature

6. Post-filing support for notices, assessment, or refunds

Client Responsibilities:

• Provide complete and accurate financial data

• Submit all statutory records and disclosures

• Inform us of any foreign income, related-party transactions, or extraordinary items

Benefits of Timely Filing:

• Statutory compliance

• Avoidance of penalties and prosecution

• Carry forward of losses

• Improved financial credibility

• Smooth audits and funding eligibility

We recommend initiating the process well before the due date to ensure seamless compliance.

Warm regards,
[Consultant Name]
[Designation / Firm Name]