Partnership Firm Tax Return Filing
Income Tax Return Filing for Partnership Firms in India
Ensure timely and accurate ITR filing for your partnership firm with expert guidance on ITR-5, audits, capital accounts, and compliance. Tax Pal Solutions simplifies the entire process.
Key Benefits:
- Filing Support for ITR-5 Form
- Capital Account & Profit Distribution Review
- Bookkeeping & Statutory Audit Assistance
- Full Compliance with Income Tax Act, 1961
- Dedicated Assistance from Experienced Tax Experts
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Overview
What is a Partnership Firm Tax Return Filing?
Partnership firm tax return filing refers to submitting ITR-5 to the Income Tax Department of India. Filing is mandatory for both registered and unregistered firms, even if there is no profit. Filing ensures:
- Compliance with the Income Tax Act, 1961
- Carry forward of losses
- Eligibility for refunds
- Proper financial documentation
Types of Partnership Firms:
- Registered Partnership Firm – Registered under Indian Partnership Act, 1932, with a registration certificate.
- Unregistered Partnership Firm – Operates without registration.
Partners must maintain accurate records, act in the firm’s best interest, and understand profit-sharing tax implications.
Tax Obligations for Partnership Firms
| Tax Component | Rate / Details |
|---|---|
| Flat Tax on Profits | 30% |
| Surcharge (Income > ₹1 Cr) | 12% |
| Health & Education Cess | 4% |
| Basic Exemption Limit | Not Applicable |
Why File Even with Nil Income:
- Legal obligation for all partnership firms
- Electronic filing is mandatory (ITR-5)
- Carry forward losses for future years
- Avoid penalties (Section 234F, Section 234A)
- Proof for loans, tenders, visa applications
- Claim refunds for TDS
Applicable ITR Forms
| Form | Usage |
|---|---|
| ITR-5 | Main form for partnership firms, LLPs, AOPs, BOIs, AJPs, etc. |
| ITR-4 (Sugam) | Optional for partnership firms under presumptive taxation (income ≤ ₹50 lakh, no audit required) |
Filing Due Dates (AY 2025-26)
| Partnership Firm Category | ITR-5 Filing | Tax Audit Report Filing |
|---|---|---|
| Not required to be audited | 15 Sep 2025 | N/A |
| Required to be audited | 31 Oct 2025 | 30 Sep 2025 |
| Requiring Transfer Pricing Report (Form 3CEB) | 30 Nov 2025 | 31 Oct 2025 |
| Belated/Revised Return | 31 Dec 2025 | - |
| Updated Return (ITR-U) | 31 Mar 2030 | - |
Penalties for Non-Filing
| Consequence | Details |
|---|---|
| Late Filing Fee (Section 234F) | ₹1,000 (Income ≤ ₹5 lakh), ₹5,000 (after due date), ₹10,000 (after Dec 31) |
| Interest on Late Payment (Section 234A) | 1% per month on unpaid tax |
| Loss of Carry Forward of Losses | Cannot offset losses in future |
| Prosecution & Legal Action | 3 months–7 years imprisonment for tax evasion > ₹25 lakh |
| Penalty for Concealment (Section 270A) | 50%–200% of tax evaded |
Documents Required
Core Documents:
- Partnership Deed, Registration Certificate, Udyam/GST Certificates
- Profit & Loss Account, Balance Sheet, Trading Account
- Bank Statements, Ledgers, Capital Accounts
- TDS Certificates, Form 26AS / AIS / TIS
If Tax Audit Applicable:
- Tax Audit Report (Form 3CB/3CD)
- Detailed books of accounts, vouchers, trial balance
Filing Process Online
- Login – Income Tax e-Filing Portal
- Select ITR Form – ITR-5 for partnership firms
- Fill Form – General Info, Balance Sheet, P&L, Schedules
- Review & Validate – Correct errors using portal validation
- Verify Return – Using DSC or EVC
- Submit & Download Acknowledgement (ITR-V)
- Send Signed Copy (if required)
Deductions and Allowances
- Salary and interest paid to partners (Section 40(b))
- Business expenses: rent, repairs, salaries, loans, utilities, advertising, legal fees, depreciation
- AMT applies if deductions claimed under Section 115JC exceed ₹20 lakh
Tax Audit
Compulsory If:
- Business turnover > ₹1 crore
- Professional gross receipts > ₹50 lakh
Audit Process:
- Verification of transactions and financial statements
- Compliance check
- Tax Audit Report (Form 3CA/3CB and 3CD) submission
ITR Status Tracking
Without Login:
-
Use acknowledgement number & OTP on e-Filing portal
With Login:
- Navigate e-File → View Filed Returns
- Download ITR-V, view status, and track e-Verification
Income Tax Notices
- Notices may request clarifications or document submission
- Verify details, identify reason, gather documents
- Respond within deadlines or seek professional guidance
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