ITR 6 Form: Everything You Need to Know
Updated: Nov 11
Income Tax Return (ITR) forms are essential for taxpayers in India to report their income and pay taxes accordingly. Among the various ITR forms, ITR 6 is specifically designed for companies and firms that are not claiming exemption under section 11 of the Income Tax Act. This article provides a comprehensive overview of ITR 6, including its purpose, eligibility criteria, filing process, and essential tips for successful submission.
Table of content
What is ITR 6?
ITR 6 is the income tax return form that must be filed by companies, including:
Domestic companies
Foreign companies
Firms (partnerships, limited liability partnerships, etc.)
This form is used to report the income earned by these entities during the financial year and to calculate the tax liability. Unlike ITR 5, which is for partnerships and LLPs claiming exemption under Section 11, ITR 6 is applicable to those entities that do not claim such exemptions.
Who Should File ITR 6?
The following entities are required to file ITR 6:
Domestic Companies: Companies that are registered in India and are subject to Indian tax laws.
Foreign Companies: Companies that are registered outside India but have income sourced from India.
Partnership Firms: All partnership firms, including limited liability partnerships (LLPs), that do not claim exemption under Section 11.
Companies with Income from Business or Profession: Any company that has income from business or profession must file ITR 6.
Key Features of ITR 6
No Exemption under Section 11: ITR 6 is specifically for companies and firms that are not claiming any tax exemptions under section 11 of the Income Tax Act, which pertains to income derived from property held for charitable or religious purposes.
Comprehensive Reporting: The form requires detailed reporting of income, expenses, and tax calculations, including income from business, capital gains, and other sources.
Tax Computation: ITR 6 includes sections for calculating the tax liability based on the applicable tax rates for companies.
Structure of ITR 6 Form
The ITR-6 Form is divided into two main parts and several schedules to ensure comprehensive reporting for businesses, particularly companies. Here's a structured breakdown:
Part A - General Information
This section gathers the company’s basic details such as PAN, name, address, and contact details. It's essential for all filings.
Part A-BS and Part A-BS-Ind AS
These sections capture the Balance Sheet details as of March 31 or in compliance with Indian Accounting Standards (Ind AS) if applicable. It includes assets, liabilities, equity, and other financial details required for accurate financial reporting.
Manufacturing, Trading, and Profit & Loss Accounts
There are two sets of formats for these accounts: one following traditional financial statements and the other compliant with Ind AS. These sections cover the manufacturing account, trading account, and profit & loss account details for the financial year.
Part A-OI (Other Information)
This part requires miscellaneous data about the company that doesn’t fit neatly into other categories. This can include additional disclosures as mandated by the Income Tax Department.
Part A-QD (Quantitative Details)
Here, companies provide quantitative details about their inventory, including information about production, stock-in-hand, and sales volumes.
Part A-OL (Receipts and Payments for Companies under Liquidation)
Companies under liquidation must furnish details of their receipts and payments during the liquidation process in this section.
Part B - Computation of Total Income and Tax
Part B-TI (Computation of Total Income)
This part consolidates income across all sources—profits, capital gains, house property, and other sources—while applying deductions and exemptions to calculate total taxable income.
Part B-TTI (Computation of Tax Liability)
Based on the total income computed in Part B-TI, the tax liability is calculated, factoring in applicable rates, surcharge, and cess.
Key Schedules
Schedule-HP (Income from House Property): Computes income from renting or leasing house property.
Schedule-BP (Income from Business/Profession): Summarizes the profits and gains from business or professional activities.
Schedule-DPM, DOA, and DEP: These schedules are related to depreciation, covering assets like plant and machinery (Schedule-DPM) and others (Schedule-DOA). Schedule DEP summarizes the depreciation on all assets.
Schedule-CG (Capital Gains): Computes capital gains or losses from the sale of assets, investments, or property.
Schedule 112A and 115AD: These are specialized schedules for reporting income from equity shares or units where Securities Transaction Tax (STT) is paid, especially under Sections 112A and 115AD.
Schedule VDA: Reports income from the transfer of Virtual Digital Assets (VDAs) like cryptocurrency or NFTs.
Schedule-OS (Income from Other Sources): Captures miscellaneous income such as interest, dividends, or winnings.
Schedule-CYLA/BFLA/CFL: These schedules report current year loss adjustment (CYLA), unabsorbed loss brought forward from earlier years (BFLA), and carry-forward of losses to future years (CFL).
Schedule ICDS: Reports the effect of Income Computation and Disclosure Standards (ICDS) on the profit calculation.
Schedule-MAT and MATC: Reports Minimum Alternate Tax (MAT) and MAT credit as applicable under Section 115JB.
Schedule FA and FSI: Reports details of foreign assets, income from outside India, and claims for tax relief under DTAA (Double Tax Avoidance Agreements).
Schedule GST: Requires details about the turnover or gross receipts as reported under GST.
Schedule SH-1 and SH-2: Requires disclosure of shareholding details in unlisted companies and start-ups respectively.
Schedule AL-1 and AL-2: Captures the company's assets and liabilities at the end of the financial year. AL-2 is specific to start-ups.
Schedule FD: Provides a breakdown of payments and receipts in foreign currency, which is crucial for businesses with international transactions.
Key Changes in the ITR 6 Form in AY 2024-25
Legal Entity Identifier (LEI): For better identification of corporate entities, LEI information is now mandatory.
New Schedule 115TD: This schedule has been introduced for reporting tax payable on accreted income, specifically under the exit tax provisions for trusts and institutions.
Disclosures for MSMEs: Businesses must disclose any amounts due to Micro, Small, and Medium Enterprises (MSMEs) that remain unpaid beyond the prescribed period, as per MSME regulations.
Winnings from Online Games: Reporting is now required for income from online games under Section 115BBJ.
Capital Gains Account Scheme: The form includes new disclosures for amounts deposited in Capital Gains Accounts.
Dividend Income from IFSC Units: Companies must report dividend income derived from International Financial Services Centre (IFSC) units.
Furnishing of Audit Details: The company must now provide the acknowledgment number of the Audit Report and Unique Document Identification Number (UDIN) issued by auditors.
ITR 6 Filing Process
Filing ITR 6 involves several steps, which can be completed online through the Income Tax Department's e-filing portal. Here’s a step-by-step guide:
Step 1: Register on the E-Filing Portal
Visit the Income Tax e-filing portal.
If you are a new user, register by providing your PAN, email ID, and mobile number.
Step 2: Log In to Your Account
Use your credentials to log in to your account on the e-filing portal.
Step 3: Select the ITR Form
Navigate to the "e-File" section and select "Income Tax Return."
Choose "ITR 6" from the list of available forms.
Step 4: Fill in the Required Details
Complete all sections of the form, including personal information, income details, deductions, and tax computation.
Ensure that all figures are accurate and that you have all necessary supporting documents.
Step 5: Validate the Information
Use the "Validate" button to check for any errors or missing information in the form.
Step 6: Submit the Form
Once you have verified all details, submit the form electronically.
You will receive an acknowledgment receipt upon successful submission.
Step 7: E-Verify Your Return
After submission, you need to e-verify your return using one of the available methods, such as Aadhaar OTP, net banking, or by sending a signed physical copy of the ITR-V to the CPC, Bengaluru.
Important Tips for Filing ITR 6
Keep Documents Ready: Before starting the filing process, ensure that you have all necessary documents, including financial statements, tax deductions, and previous year’s return.
Double-Check Figures: Accuracy is crucial when filing ITR 6. Double-check all figures to avoid discrepancies that could lead to penalties.
Claim All Eligible Deductions: Familiarize yourself with the deductions available under the Income Tax Act and ensure you claim all eligible deductions to minimize your tax liability.
File on Time: Ensure that you file your ITR 6 before the due date to avoid penalties and interest on late filings.
Seek Professional Help: If you are unsure about any aspect of filing ITR 6, consider consulting a tax professional or chartered accountant for guidance.
Common Challenges in Filing ITR 6
Filing ITR 6 can present several challenges, including:
Complexity of the Form: The detailed nature of ITR 6 can be overwhelming, especially for first-time filers.
Understanding Tax Regulations: Keeping up with changes in tax laws and regulations can be challenging for companies.
Data Accuracy: Ensuring accuracy in financial data and tax calculations is crucial to avoid penalties.
E-Filing Issues: Technical glitches on the e-filing portal can sometimes hinder the filing process.
Conclusion
Filing ITR 6 is a crucial aspect of tax compliance for companies and firms in India. By understanding the form's requirements, eligibility criteria, and filing process, businesses can ensure they meet their tax obligations while optimizing their tax liabilities.
FAQ
Q1. What is ITR 6?
ITR 6 is the income tax return form for companies and firms that are not claiming exemption under Section 11 of the Income Tax Act.
Q2. Who should file ITR 6?
Domestic companies, foreign companies, and partnership firms that do not claim exemption under section 11 are required to file ITR 6.
Q3. What documents are required to file ITR 6?
Key documents include PAN, financial statements, GST returns, bank statements, and any other relevant documentation related to income and expenses.
Q4. What is the due date for filing ITR 6?
The due date for filing ITR 6 is typically July 31 for companies that are not required to have their accounts audited. However, this date may vary, so it is advisable to check the official notifications.
Q5. Can I file ITR 6 offline?
ITR 6 must be filed online through the Income Tax Department's e-filing portal. However, you can submit a signed physical copy of the ITR-V if you choose to verify your return manually.
Q6. What happens if I miss the due date for filing ITR 6?
If you miss the due date, you may face penalties and interest on the tax owed. You can file a belated return, but penalties may still apply.
Q7. Can I revise my ITR 6 after filing?
Yes, you can revise your ITR 6 within the prescribed time frame if you discover any errors or omissions in your original filing.
Q8. What is the penalty for filing incorrect information in ITR 6?
Providing incorrect information can lead to penalties, interest on unpaid taxes, and potential legal action by the tax authorities.
Q9. Is it mandatory for all companies to file ITR 6?
Yes, all companies that do not qualify for exemption under section 11 are required to file ITR 6, regardless of their income level.
Q10. What is the process for e-verifying ITR 6?
You can e-verify your ITR 6 using methods such as Aadhaar OTP, net banking, or by sending the signed ITR-V to the CPC, Bengaluru.
Q11. Can I claim deductions under section 80C while filing ITR 6?
Yes, companies can claim deductions under various sections, including section 80C, subject to eligibility and limits.
Q12. What is the HSN code for reporting income in ITR 6?
The HSN code for income reporting varies based on the nature of the business. Ensure you use the correct HSN code applicable to your business operations.
Q13. How do I calculate my tax liability when filing ITR 6?
Tax liability is calculated based on the income reported, applicable deductions, and the prevailing corporate tax rates.
Q14. What if my company has losses? Do I still need to file ITR 6?
Yes, even if your company incurs losses, you are required to file ITR 6 to report the losses and carry them forward for future tax assessments.
Q15. Can I file ITR 6 if my company is dormant?
Yes, a dormant company is still required to file ITR 6, reporting its status and any income or expenses incurred during the financial year.
Q16. Is it mandatory to maintain books of accounts for filing ITR -6?
Yes, companies must maintain books of accounts as per The Income Tax Act. These books are essential for accurately preparing and filing the ITR-6 form.
Q17. What are the key sections in the ITR 6 form?
The key sections in the ITR 6 form consist of details about taxpayers, income from various sources, tax computation and verification. A particular section covers the income from a business, profession, depreciation adjustments, and details of international transactions if applicable.
Q18. How do I calculate taxable income for ITR 6?
To calculate taxable income for ITR 6 begins with income aggregating from all the sources. It includes business, profession, investment and other earnings. You need to subtract the eligible deductions like expenses related to the business or professional income and apply the tax rates to check the total tax liability.
Q19. What are the penalties for late filing of ITR 6?
The penalties include late fees under Section 234F that range from INR 1,000 to INR 10,000. It depends upon how late the return is filed. In addition to it, interest on tax due can be charged under Section 234A.
Q20. How to verify ITR 6 form?
ITR 6 form must be verified by One Time Password, net banking, and Digital Signature Certificate.
Related Posts
See AllIn India, one of the most well-liked government-sponsored savings plans is the Public Provident Fund (PPF) account. The PPF plan, which...
Credit card companies make it easy to take out cash from ATMs or banks, giving you quick access to money when required. However, to make...
Everybody has to deal with personal finance at some point. You will have plenty of costs and obligations when you get older and begin...
Comments