Basic Tax Rate

• The current income tax rate for Limited Liability Partnerships (LLPs) in India is 30% on their taxable income
  
• This rate applies to both domestic and foreign LLPs operating in India
  
• LLPs are taxed as a separate legal entity under the Income Tax Act, 1961
  
• The flat rate remains the same regardless of the income slab or turnover
  
• There is no option for reduced rates as available to certain companies
  

Surcharge Applicability

• A surcharge of 12% is levied if the total income of the LLP exceeds ₹1 crore in a financial year
  
• The surcharge is calculated on the income tax payable, not on total income
  
• If income does not exceed ₹1 crore, no surcharge is applicable
  
• This surcharge increases the effective tax liability for high-income LLPs
  
• The applicability is automatic based on income level
  

Health and Education Cess

• In addition to the base tax and surcharge, a Health and Education Cess of 4% is levied
  
• The cess is applied on the total of income tax and applicable surcharge
  
• It is uniform for all LLPs, regardless of income or nature of business
  
• The cess supports government education and healthcare programs
  
• It increases the overall effective tax rate slightly above 30%
  

Effective Tax Rate Summary

• For LLPs with income up to ₹1 crore:
  
  • 30% income tax + 4% cess = 31.2% effective rate
    
• For LLPs with income above ₹1 crore:
  
  • 30% income tax + 12% surcharge + 4% cess = 34.944% effective rate
    
• These rates are standard across all sectors and regions
  
• LLPs do not receive concessions like MSME tax relief or reduced corporate tax slabs
  

Additional Tax Notes

• LLPs are not subject to the Minimum Alternate Tax (MAT) like companies
  
• They are exempt from Dividend Distribution Tax (DDT)
  
• Partners are not taxed again on profits withdrawn from the LLP
  
• LLPs must file ITR-5 annually and maintain compliance with income tax provisions
  
• Advance tax provisions apply if tax liability exceeds ₹10,000 in a year