High time for Companies and LLPs to file income tax returns on time


Having stepped into 2013-14, and the most urgent to do factor on the cards pertaining to the Financial Year 2012-13, it is high time for all the Companies and LLPs to finalize their Accounts and get the accounts audited by a Chartered Accountant in full time practice for the purpose of adopting the same in the upcoming Annual General Meeting and subsequent filing of Income Tax Returns within 30th September, 2013. And certainly, it is high time for Companies and LLPs to file income tax returns on time. If Companies and LLPs file their Tax Returns then they can reap certain benefits. The Directors of companies or Designated Partners of LLPs who are reading this article may please note that you can get multiple benefits of filing Income Tax Returns u/s 139(1) of Income Tax Act within the due date i.e. by 30th September, 2013, of your Company or LLP for AY 2013-14. Here are the reasons backing your concern –


For the Financial Year 2012-2013 (AY 2013-2014):-

For the FY 2012-13 you can file your Income Tax Return u/s 139(1) within the due date of 30th September’13 to reap these benefits-

(i)               Revise Your Return as many number of times as you want: If you file your Company’s or LLP’s Income Tax Return within 30th September, 2013 then you can revise your return within 31st March, 2015 for any number of times.

(ii)             Seed Funding: In cases of Seed funding ,Angel funding, etc. where trust on a new business venture is very much important because these types of funding are done looking on the viability or future potential of a new company or LLP, it is considerably important to file the first income tax returns, to avoid any questions arising on due diligence on the company or LLP likely to be done before approving the initial funding, and reposing hopes on the start up venture, so to speak. If you so wish to make the funding creep in your company, and take your entity to the next level, your business should be all set to file Income Tax Return u/s 139(1) within the due date ,i.e.,  30th September, 2013 and build the trust factor into the minds of the prospective lenders.

(iii)          Carry Forward of Losses: If you file your Income Tax Return within this 30th September, 2013 then you can carry forward your Business Losses to the next year and can set off against succeeding year’s profit. You can carry forward the business loss maximum upto 8 years, which makes real sense to the start up entrepreneurs.

(iv)           Unabsorbed Depreciation Claim: Though you do not require to file your IT Return to carry forward your unabsorbed depreciation still you can derive certain benefits to this regard. In filing of return we put classified details of different rates of depreciation charged on various Fixed Assets and when they are ready for put to use. So for the purpose of keeping correct records you need to file your IT Return.

(v)             Newly formed Company or LLP can take expense benefits: In the initial year a Company or LLP makes so many expenses to initiate the business. These costs are commonly known as Preliminary Expenses. For Accounting purpose these expenses are regarded as Unamortized Expenses under the head Other Non Current Assets in the Balance Sheet. This expense can be charged to Profit and Loss Account as 1/5th of the entire expense in five consecutive years starting from the year of making the expense only if you file your IT Return for the financial year in which you have incorporated your business.

(vi)           Other Benefits: If you file your IT Return within 30th September, 2013 you can get benefit in getting your Trade License, registering your company or LLP for Professional Tax , your company or LLP’s Shop & Establishment Expenses become allowed as expenses in computing your business income ,  Rent of your office premises or for the premises of running other business activities can also be allowed in computing your business income.

For Financial Year 2011-2012 (AY 2012-13):-

Those companies or LLPs who have not file their Income Tax Return for the financial year 2011-2012 can file their IT Return within 31st March, 2014. It would be regarded as your belated return. It has certain benefit which has covered in an article named  Set off and carry forward of losses are completely different

For Financial Year 2010-2011 (AY 2011-12):-

Those companies or LLPs who have not filed their Income Tax Return for the financial year 2010-2011 , they cannot file their IT Return any more and would be abstained from reaping such benefits already discussed above.

Having that said and understood, it is a real high time for Companies and LLPs to file income tax returns on time, after getting the books of accounts prepared and finalized, duly audited by a Chartered Accountant. In this regard, we wish to state that we have a domain expertise in handling taxation issues assisting thousands of individuals in India and abroad which includes Online return filing services, Tax planning and save taxes service, Tax refunds services, ITR Rectification, PAN and TAN related services,NRI Taxation and all other services related to individual taxation, covering both Salaried and Non-Salaried Individuals. We help you in better planning of taxes, offering complete tax planning, wherein we would analyze your taxes, taking into account the current income and current tax saving tools employed by you and would suggest ways to save more taxes.  We would send you a written note based on our analysis, which would provide in detail about the current taxes paid by you, and proposed tax saving tips for lowering your taxes, at a high time for Companies and LLPs to file income tax returns on time We would also like to draw attention on the following related topics : Mandatory e-return filing for companies and LLPs Why do companies and LLPs need to maintain accounts? Penalty provisions for Companies and LLPs Company Registration Procedure in India