Proprietorship Company Registration India

Proprietorship entities are required to file income tax return like any other entity registered in India. Since proprietorships are considered to be one and same as the proprietor, the income tax return filing of the proprietorship and the proprietor are also the same.

The income tax return of a proprietor is applicable based on their age and turnover limits. They are as follows:

1. If the proprietor’s age is below 60, then, filing of the income tax return is required if the annual turnover crosses INR 2.5 lakhs.
2. If the proprietor’s age is between 60 & 79, then, filing of income tax return is required if the annual turnover crosses INR 3 lakhs.
3. If the proprietor’s age is 80 and above, then, filing of income tax return is required if the annual turnover crosses INR 5 lakhs.

Tax Audit for Proprietorships:

An audit would be required for a proprietorship entity if the total sales turnover is exceeds INR 1Cr during the financial year. In case of a professional, audit would be mandatory if total gross receipt exceeds INR 50 lakhs during the financial year under assessment. Also, an audit would be required for any proprietorship entity under presumptive taxation scheme irrespective of their turnover if the income claimed were lower than the deemed profits and gains under the scheme.

Due Date for Proprietorship’s Tax Return:

Proprietorships operating in India are required to file income tax return each year. The income tax return of a proprietorship, which does not require an audit, is due on 31st July each year. In case if the proprietor’s books of accounts need to be audited under the Income Tax Act, the returns would be due on September 30th. 

Form to be filed by Proprietorships:

A proprietor or a Hindu Undivided Family carrying out a proprietary business or profession can file Form ITR-3 and those proprietors who would like to pay income tax under the presumptive taxation scheme can file ITR-4 Sugam.

NOTE: These charges are applicable for all proprietorships having turnover of less than INR 25 lakhs. In case of a tax audit, additional charges will be applicable.

MyDBiz is the market leader in providing compliance services in India. Before we get started with the engagement, all the required information and documents are collected. An engagement manager would be assigned who will be the point of contact till the engagement is completed. The average time required to complete the tax return filing compliance is 3-4 working days depending on the government processing time and client document submission.

For more information, feel free to contact us at info@mydbiz.com or call us at +91 9632 993 993.