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Proprietorship Tax Return Filing
Producer

Proprietorship Tax Return Filing

# Eligibility Criteria for Proprietorship Tax Return Filing :

  • $
    If the total income exceeds ₹3 lakhs, all owners under the age of 60 are required to file an income tax return under the Income Tax Act
  • $
    If the income exceeds ₹3 lakhs, owners above the age of 60 must file income tax
  • $
    If the total income exceeds ₹3 lakhs, proprietors under the age of 80 must pay income tax
  • $
    If the income exceeds ₹5 lakhs, proprietors above the age of 80 are required to file proprietorship tax returns.

On meeting certain conditions, Sections 10A, 10B, 80-IA, 80-IAB, 80-IB, and 80-IC will provide deductions.

# Documents Required :

As a sole proprietor, the following documents are required for ITR filing:

  • 1

    PAN card

  • 2

    Aadhar card

  • 3

    Bank account details

  • 4

    Form 16, 16A and 26AS

  • 5

    Advance tax payment challan

# Income Tax Slab for Proprietorship Firm AY 2021-2022 :

The advantages of filing IT returns are:

Income range Tax rate
0- 2,50,000 NIL
2,50,001- 5,00,000 5%
5,00,001-7,50,000 10%
7,50,001- 10,00,000 15%
10,00,00-12,50,000 20%
12,50,000- 15,00,000 25%
Above 15,00,000 30%


When it comes to filing a sole proprietorship income tax return the proprietors age should be within the 60 to 80 years in the previous financial year

Income range Tax rate
Up to 3,00,000 NIL
3,00,000 to 5,00,000 5% of the total income above 3,00,000
5,00,000 to 10,00,000 10,000+20 % of the total income above 5,00,000
Above 10,00,000 1,10,000 + 30% of the total income above 10,00,0000


If the age of the proprietor is more than 80 the following tax slab is used

Income range Tax rate
Up to 5,00,000 NIL
5,00,000 to 10,00,000 20% of the total income above 5,00,000
Above 10,00,000 1,00,000 +30% of the total income above 10,00,000


Irrespective of the age if the sole proprietorship form is a nonresident then the following tax slab is used

Income range Tax rate
Up to 2,50,000 NIL
2,50,000 to 5,00,000 5% of the total income above 2,50,000
Above 10,00,000 12,500 + 20% of the total income above 5,00,000
Above 10,00,000 1,12, 500 + 30 of the total income above 10,00,000

# How to Complete Proprietorship Tax Return Filing

The income tax of the proprietorship is the proprietor's income tax and it is crucial to be filed every year without fail. The E-sign of the proprietor will be used to file the income tax return. Based on the type of proprietorship you will have to submit two different forms. Initially, you will have to submit all the required documents including your PAN card to our experts

• ITR-3 Form: If the proprietorship is run by a hindu undivided family (HUF) or any other owner

• Form ITR-4 Sugam: This one is used by proprietorships that are subject to presumptive tax schemes. Filing this form will reduce the burden of compliance for small businesses and still provide you with the deductions of HUFs.

Subsequently, our experts will register it in the official portals. The assessment year and ITR filing type will be chosen based on the scenario. You will be provided the required confirmation after completing the process.


# Due Date for Proprietorship Tax Return Filing :

Losses in the business, if any, can be carried forward if the proprietor files an income tax return before the deadline.

  • • Income tax return filing wherein the audit is not necessary 31 July of every year

  • • Income tax return filing wherein the audit is necessary on 31 October of every year.

# Audit for Proprietorship :

Depending on the annual turnover of the proprietorship, auditing may be necessary under the following scenarios.

  • 1
    During the assessment year, the turnover of the proprietorship firm conducting business exceeds 1 crore
  • 2
    In the case of a professional proprietorship, an audit is required if the total receipts of the business exceed 50 lakh
  • 3
    An audit is required whenever a proprietorship is subject to any presumptive tax scheme, regardless of yearly turnover.

As per the Income Tax Act of 1961 the proprietorship firm's audit must be performed by a certified Chartered Accountant. Don't worry if you don't have a CA at your disposal, Tax Trims will cover you with that!