Income Tax Compliances for Proprietorship Business
Every proprietorship business must comply with income tax regulations, regardless of whether it earns a profit or incurs a loss. Even if there are no transactions, filing an income tax return is mandatory each year. Our Compliance Manager will assist you in preparing all required documents and filing your income tax return seamlessly.
Key Tax Compliance Requirements:
- Quarterly Advance Tax Payments
- Proprietors must calculate and pay advance tax every quarter if their total tax liability exceeds ₹10,000 in a financial year.
- Filing of Income Tax Returns (ITR)
- Every proprietorship must file an income tax return within the due date to avoid penalties.
- Tax Audit Compliance (if applicable)
- A tax audit is mandatory if the business turnover or gross receipts exceed ₹1 crore in a financial year.
- The Tax Audit Report must be filed within the prescribed deadline.
- Minimum Alternate Tax (MAT) & Book Profit Calculation
- Businesses must compute MAT & Book Profit, excluding Sections 115BAA & 115BAB, as per the Income Tax Act.
- Transfer Pricing Compliance
- If a proprietorship business has international transactions, it must comply with transfer pricing regulations and file related documents.
- Financial Statements & ROI Filing
- Businesses must prepare financial statements and file the Return of Income (ROI) within the due date under Section 139(1).
- GST Annual Audit & Reconciliation
- A GST audit is required for businesses exceeding the prescribed turnover limit.
- Proper reconciliation of GST returns with financial statements is necessary to ensure compliance.
