ITR 6 – Company Income Tax Filing

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Establishing a business comes with its own set of challenges, and navigating the complexities of filing returns is a vital aspect of successful operations. ITR-6 filing is a key annual compliance requirement for companies in India. Accurately filing ITR-6 on time is crucial for ensuring compliance with the Income Tax Act 1961, helping businesses avoid penalties and potential legal complications.

Ready to complete your company’s ITR 6? IndiaFilings experts are here to guide you through every step—let’s begin your ITR-6 filing today!

ITR 6 Applicability

ITR 6 applies to all companies except those claiming an exemption under Section 11 of the Income Tax Act. Section 11 applies to income derived from property held under a trust or legal obligation for charitable or religious purposes. Therefore, companies with income used for charitable or religious purposes are not eligible to file ITR 6.

Applicable Entities

Companies registered under the Companies Act of 2013 or the Companies Act of 1956 are required to file the ITR 6 Form. This includes:

Private Limited Company
One Person Company
Public Limited Company

Who is Not Eligible to File the ITR 6 Form?

The following entities are not eligible to file the ITR 6 Form:

Individuals
Hindu Undivided Family (HUF)
Firms
Associations of Persons (AOP)
Bodies of Individuals (BOI)
Local Authorities
Artificial Judicial Persons
Companies that seek exemption under section 11 of the Income Tax Act.

ITR 6 Due Date

Every company is required to file its Income Tax Return under Section 139 of the Income Tax Act by October 31st of the assessment year. If transfer pricing is involved, such a company is required to file its Income Tax Return by November 30th of the assessment year.

The Importance of Timely ITR Filing for Companies

Filing ITR 6 on or before the due date not only ensures compliance with tax laws but also offers several financial and operational advantages for your business.

Carry Forward of Losses: Filing on time allows a company to carry forward its losses for adjustment against future profits. According to Section 72 of the Income Tax Act, companies can carry forward business losses up to 8 subsequent assessment years. Failure to file on time results in losing this right, negatively impacting the company’s financial position.
Avoiding Penalties and Interest: Late filing incurs a fee under Section 234F of the Income Tax Act. Additionally, timely filing helps avoid interest charges on any outstanding tax liabilities under Sections 234A, 234B, and 234C.
Reduced Risk of Scrutiny:Timely filing minimizes the risk of scrutiny by tax authorities. Late submissions can raise red flags, potentially leading to notices and further examinations by the tax department.
Quicker Refund Processing:Filing your income tax return on time facilitates faster processing of tax refunds from the income tax department.
Enhanced Credit Opportunities: Timely filed tax returns are often required by banks and financial institutions as part of loan and credit facility applications. Demonstrating compliance and financial stability can improve the chances of securing credit.
Smoother Winding-Up Process:If a company decides to cease operations, having all Income Tax returns filed on time is essential for a smoother and quicker winding-up process.

Get started today with IndiaFilings to complete your ITR 6 filing seamlessly and ensure your business remains compliant with tax regulations!

Structure of ITR 6 Form

ITR 6 is divided into Part A and Part B ( along with the subsections) with multiple schedules that include information relevant to the income and tax of the taxpayer. Let us have a detailed look at this.

Part A (and its subsections)

General information:This Subsection should be filled out with the basic details of the entity, such as the name, PAN number, address, CIN, incorporation date, etc.
Trading Account:This subsection requires details that are relevant to the company’s income and expenditures.
Balance sheet: This subsection should consist of the company’s details, such as liabilities, current liabilities, share capital, and more.
Manufacturing account:This Subsection requires the figures for manufacturing the accounts relating to the inventory, such as opening stock, closing stock, and cost of the goods that are produced.
Profit and Loss Account: This subsection should be filled with the details of the company’s profit or the loss that is incurred during the relevant financial year.

Part B (and its subsections)

Part B-TI: Computation of Total Income
Part B-TTI: Computation of tax liability for the total income.

Schedules	Purpose
Schedule –HP	For computing incomes under the head Income from House Property
Schedule –BP	For computing incomes under the head “profit and gains from business and profession
Schedule –DPM	For calculating depreciation on plant & machinery
Schedule –DOA	For a summary of depreciation on all assets
Schedule –DCG	For calculating the deemed capital gain on the sale of depreciable assets
Schedule –ESR	Deductions u/s 35, i.e. expenditure on scientific research
Schedule –CG	For calculating income under the head “Capital gains.”
Schedule –OS	For calculating income from other sources
Schedule –CYLA	Calculating the income after setting off the current year’s loss
Schedule –BFLA	Calculation of income after setting off the unabsorbed loss of the previous year
Schedule –CFL	Statement of loss for carrying forward to a further year
Schedule –UD	Statements of unabsorbed depreciation and allowance
Schedule –ICDS	Income computation disclosure standards on profit
Schedule –10AA	Deductions u/s 10AA
Schedule –80G	Details of deduction u/s 80G relating to donations
Schedule –80 GGA	Statement of donations for scientific research and rural development
Schedule –VIA	Statement of deductions from total income under Chapter VI-A
Schedule –SI	Details of income chargeable at special tax rates
Schedule –PTI	Details relating to passing through income from business trust or investment fund
Schedule –EI	Statement of exempted incomes
Schedule –MAT	Details of tax payable u/s 115JB (Minimum Alternate Tax)
Schedule –DDT	statement of tax paid on dividend, i.e. “dividend distribution tax”
Schedule –BBS	Details of tax distributed income on buyback of shares
Schedule –ESI	Statement of foreign incomes and tax relief to it
Schedule –IT	Details on advance-tax paid and self-assessment tax
Schedule –TDS	Details of TDS on incomes other than salaries
Schedule –TCS	Statement of TCS (Tax collected at source)
Schedule –FSI	Statement of income accruing outside India
Schedule –TR	Details of tax relief claimed for foreign tax paid
Schedule –FA	Complete details of foreign assets and foreign income
Schedule –SH1	Details of shareholding of an unlisted company
Schedule –SH2	Details of shareholding of start-ups
Schedule –AL1	Statement of assets and liabilities at the end of the year
Schedule –GST	Statement of turnover reported for GST
Schedule –FD	Details of payment/receipt made in foreign currency

Procedure for Filing ITR Form 6

After logging into the Income Tax Portal, navigate to the “e-Filing” section, select “Income Tax Returns,” and choose ITR Form 6 for filing. To ensure a smooth and accurate filing of ITR Form 6, the Income Tax Department recommends that taxpayers follow these steps in the correct sequence:

Part A: Begin by filling out the taxpayer’s basic details, including personal information and income sources.
Schedules: Complete the relevant schedules that apply to your company’s income, deductions, and tax details. This includes details of profits and gains, tax payments, and any applicable exemptions.
Part B: Fill in the total income, tax computation, and any carry-forward losses.
Verification: Review all the information provided and complete the verification section to validate the accuracy of your return.
Submit the ITR: Once all sections are filled out and verified, submit the ITR Form 6 electronically.
Acknowledgement: After successful submission, download the acknowledgement receipt (ITR-V) for your records. If you opt for e-verification, you will receive an acknowledgement via email.