Proprietorship Tax Return Filing

Proprietorship Tax Return Filing

The Income Tax return filing of the proprietorship firm is the same as that of the proprietor. An audit would be required for a proprietorship firm if the total sales turnover is over 1 Crore during the financial year. In the case of professionals, the audit would be required if total gross receipts are more than 50 Lakhs during the financial under assessment.

Also, an audit would be required for a nay proprietorship firm under perspective taxation scheme irrespective of turnover if the income claimed is lower than the deemed profits and gains under the scheme. Proprietorship operating in India are required to file an income tax return each year.

For the assessment year, 2019 – 2020 only which relates to income earned in the financial year 2017 – 18, proprietorship firms would be required to file Form ITR – 3 or ITR -4 – Sugam.

Form ITR – 3

Form ITR-3 can be filed by a proprietor or a Hindu undivided family who is carrying out a proprietary business or profession.

Form ITR – 4 Sugam

Form ITR -4 –Sugam can be filed by a proprietor who would like to pay income tax under perspective taxation scheme. The presumptive taxation scheme is designed to help ease the compliance burden of small businesses by assuming a set profit margin on the total income of the business or profession.