Taxation in Private Limited Company, Taxation in Private Limited Company, Tax structure for Private Limited Company, Ebizfiling

Taxation for a Private Limited Company

Tax Structures for a Private Limited Company

Entrepreneurs identify the relevant business organization based on several factors like

  • Ease of commencing operation
  • Compliance requirements and the costs involved
  • Agreement with other members and the need to raise funds.

Each structure has its unique characteristics and attracts a certain tax liability and it is important to consider the tax implications before finalizing the formation. In this article, we list out the basic taxation for a private limited company.

 

In India, Private Limited Companies and LLP are most preferred business modes. Private Limited falls under two different categories: one is a domestic company like in which there is no forging investments and another is known as Foreign Company which means a company in which foreign investments is involved. Each company in India need to file its Income Tax return by the end of September, like for instance of FY 2020-21 , return need to be filed by  30 September 2021. The filing of Income tax return is compulsory, means irrespective of turnover , profit & loss ITR need to be filed and ROC compliances need to be carried out.

 

In Finance Budget taxation of Private Limited Company Corporate tax is divided into two category as Turnover above 400 Cr and Turnover below 400 Cr.  Income Tax rate on private Limited company is 25 % for midsize companies. Here are details of Corporate Income Tax Rate in India slab wise for FY 2020-21 AY 2021-22. Apart from income Tax there is also surcharge which applies on Private Limited companies.

 

Current Income Tax Rate for Private Limited Companies

Domestic Company with Turnover less than 400 cr

Net Income Slab (Gross Taxable Income – deductions)

Income Tax Rate

Surcharge

Health and Education Cess

Upto 1 crore

30%

NIL

4%

Above 1 crore but upto 10 crore

30,00,000+ 30%

7%

4%

Above 10 crore

3,00,00,000+ 30%

12%

4%

Domestic Company for Turnover more than 400 cr

Net Income Slab (Gross Taxable Income – deductions)

Income Tax Rate

Surcharge

Health and Education Cess

Upto 1 crore

25%

NIL

4%

Above 1 crore but upto 10 crore

25,00,000+ 25%

7%

4%

Above 10 crore

2,50,00,000+ 25%

12%

4%

For the Foreign Companies, the income tax rate is 40%.

Under the Income Tax Act , Limited Liability Partnership (LLP) are generally treated in a similar manner as the Partnership firms. On LLP Income Tax is levied at rate of 30% flat. Like in the case of individual the benefits of Income tax slabs such as 3 Lac , 5Lac is not available for tax computation of Limited Liability Partnership firm.  Whereas interest on capital and remuneration paid to partners is allowed as a deduction. However same is need to be calculated as per the provisions of Section 40(b) of Income Tax Act 1961.

 

About Ebizfiling -

EbizFiling is a concept that emerged with the progressive and intellectual mindset of like-minded people. It aims at delivering the end-to-end incorporation, compliance, advisory, and management consultancy services to clients in India and abroad in all the best possible ways.
 
To know more about our services and for a free consultation, get in touch with our team on  info@ebizfiling.com or call 9643203209.
 

Author: team-ebizfiling

The team Ebizfiling believes in providing well researched, truest and verified information to its clients and readers. The team works continuously towards enhancing Ebizfiling.com to make it a no. one platform not only for providing the best services but also for providing information to everyone through the website.

Follow Author

Leave a Reply

Your email address will not be published. Required fields are marked *

Reviews

  • Ebizfiling

    Ajay kumar

    14 Jun 2019

    Good service provided by ur staff.

  • Client review, Ebizfiling

    Jaydip Trivedi

    28 Sep 2018

    We are very grateful to you and your team. Thank you so much for all your efforts.

  • Client review, Ebizfiling

    Rishita Verma

    02 Dec 2017

    Slow service and Less helpful staff. Ebizfiling should train their staff and should also increase the efficiency of the work.

Hi, Welcome to EbizFiling!

Hello there!!! Let us know if you have any Questions.

Thank you for your message.

Call Now Button whatsapp