Step 1: Determine the Type of Business and ITR Form

The type of business entity determines the applicable ITR form:

• Sole Proprietorship: File ITR-3 or ITR-4 (if eligible for presumptive taxation).
• Partnership Firm: File ITR-5.
• LLP: File ITR-5.
• Private Limited Company: File ITR-6.
• Trust/Association: File ITR-7.

Step 2: Gather Necessary Documents

1. Business Financial Statements:
   • Profit & Loss Account.
   • Balance Sheet.
   • Trial Balance.
2. Tax Deducted at Source (TDS):
   • Form 26AS (tax credit statement).
   • TDS certificates (Form 16A/16B).
3. Bank Statements:
   • Business account statements for the financial year.
4. GST Returns:
   • GST filings to reconcile turnover and tax liability.
5. Other Relevant Documents:
   • Loan statements, investment proofs, and depreciation schedules.

Step 3: Compute Taxable Income

• Income Calculation:
  • Start with your net profit from the Profit & Loss Account.
  • Add back non-allowable expenses (e.g., personal expenses, penalties).
  • Deduct allowable expenses and exemptions.
• Presumptive Taxation (if applicable):
  • Small businesses with turnover below ₹2 crore (goods) or ₹50 lakh (services) can opt for presumptive taxation under Section 44AD/44ADA, requiring less documentation.

Step 4: Calculate Tax Liability

• Use the applicable tax slab or corporate tax rate:
  • Proprietorship: Taxed as per individual slabs.
  • Partnership Firms/LLPs: Flat 30% tax rate (plus surcharge and cess, if applicable).
  • Companies:
    • 25% or 22% for domestic companies under certain schemes.
    • 15% for new manufacturing companies (Section 115BAB).

Step 5: Log in to the Income Tax Portal

1. Visit the Income Tax e-Filing Portal.
2. Log in using your PAN (for proprietorship) or business PAN (for firms and companies).
3. Complete OTP-based authentication if required.

Step 6: Choose the ITR Form and Filing Mode

• Select the applicable ITR form based on your business structure.
• Filing Modes:
  • Online (direct entry for simple returns like ITR-4).
  • Offline (JSON utility upload for more complex returns like ITR-5 or ITR-6).

Step 7: Fill in the ITR Form

1. General Information:
   • Name, PAN, business name, address, etc.
2. Income Details:
   • Enter turnover, income, and expenses.
   • Reconcile GST turnover and financial statements.
3. TDS Details:
   • Auto-populated from Form 26AS or TDS certificates.
4. Deductions and Exemptions:
   • Claim eligible deductions under Sections 80C, 80D, 80G, etc.
5. Taxes Paid:
   • Include advance tax, self-assessment tax, and TDS.

Step 8: Verify Computation and Validate

• Cross-check tax liability and ensure data matches financial records.
• Use the “Validate” feature in the offline utility (if applicable).

Step 9: Pay Any Tax Dues

• If there’s any pending tax liability:
  • Generate a challan 
  • Pay online via Net Banking or NEFT/RTGS.

Step 10: Submit the ITR

1. Upload the completed form to the portal (for offline mode).
2. Verify the return using:
   • Aadhaar OTP.
   • Digital Signature Certificate (mandatory for companies and LLPs).
   • Net banking.

Step 11: Acknowledge the Filing

• Upon successful submission, you’ll receive an Acknowledgment (ITR-V).
• Download and e-verify within 30 days to complete the process.

Step 12: Maintain Records

• Keep a copy of:
  • Filed ITR.
  • Acknowledgment.
  • Supporting documents for audits or future reference.

Tips for Smooth Filing

1. Use Software or a Tax Consultant: For accurate computation and compliance.
2. File Before Deadline:
   • Avoid penalties (₹1,000–₹10,000 under Section 234F for late filing).
3. Reconcile Data: Ensure GST, TDS, and financial statements match to avoid discrepancies.

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