Business Tax Returns ? An Outline
Posted by Aaeesha on February 5th, 2015
When you start a business or have a company of your own, there are a lot of legal aspects to it that you need to ensure are perfectly done. Registering your company is a major part. Every company needs to be registered as a company before you start any professional activity. The next thing that comes is the papers for income tax. As we all know, it is important to pay taxes on the earnings. Taxes are to be borne by individuals as well as companies. On every income of yours, you pay a definite amount of tax to the government. This is done by filing company tax returns.
At the end of every financial year, it is required to submit a list of all the incomes to the Income Tax Department in the Government of India. A summary of all incomes need to be mentioned. There are special forms for this purpose. This statement is collected by the government as a Tax Return. Every company whose total income for the previous year has exceeded the maximum amount that is not charged by the Government for income tax is required to file their business tax returns. There is also a tax collection mode known as Tax Deduction at Source, or TDS. Here, a certain percentage of the amount is deducted at the time of making payment. The amount that is deducted is remitted to the Government as a tax. This is like the “pay as you earn” scheme.
It is the duty of every individual and every company to pay a certain amount of income to the Government as a tax. Income tax is actually an annual tax on the income. As per the income of a company in the previous year, the company is required to pay an amount as tax. The basis for calculations and the maximum amount that is not chargeable is all set down clearly. There are predefined rules for the incomes that are taken into account and are chargeable. By filing, the company tax returns, you ensure that you are paying the required amount to the Government.
The process of filing business tax returns keeps changing every financial year. New methods are introduced, the current slabs are changed, and several amendments are made. The main idea is to increase compliance, transparency, and disclosure. It is now possible to electronically file your tax returns, which makes it much easier and faster to process. Companies and firms can e-file their income tax returns. This is something that needs to be done with a lot of care and precision. Any mistake may lead to a huge issue as well. Filing them accurately, and on time is most important.