taxbrain.in/ offers expert income tax return filing services for Partnership Firms and LLPs for Assessment Year 2026-27 (FY 2025-26). Our team ensures compliance with all applicable ITR forms, audits, and deductions to minimize your tax liability.
What is a firm?
A “Firm” under Section 2(23)(i) of Income Tax Act, 1961 mirrors the Indian Partnership Act, 1932: “Persons who have entered into partnership… collectively ‘a Firm’.” LLPs, per Limited Liability Partnership Act, 2008 Section 2(1)(n), form a distinct legal entity separate from partners.
Firms/LLPs compute income under business/profession heads, with partner remuneration/interest deductible if deed-specified (interest ≤12%). taxbrain.in/ verifies deeds and optimizes allocations.
ITR Forms: Eligibility and Exclusions
ITR-4 (Sugam) for Eligible Firms
For resident Firms (excluding LLPs) with total income ≤₹50 lakh:
- Presumptive business/profession u/s 44AD (8%/6% turnover), 44ADA (50% receipts), 44AE (goods carriage).
- Up to 2 house properties.
- Other sources (interest, dividends, family pension).
- Agriculture ≤₹5,000.
Ineligible if:
- Director in company.
- Unlisted equity shares.
- Foreign assets/authority/income.
- ESOP deferral.
- Losses (b/f/c/f).
- Income >₹50 lakh.
- Special rates/retirement accounts u/s 89A.
Optional; simplifies filing.
ITR-5: Standard for Firms/LLPs
For:
- Firms, LLPs.
- AOP/BOI/AJP.
- Local authorities, rep. assessee.
- Co-op societies, registered societies (non-ITR-7).
- Trusts (non-ITR-7), deceased/insolvent estates.
- Business trusts (139(4E)), investment funds (139(4F)).
Excludes 139(4A/B/D) filers. Handles audits, losses, foreign income.
Due Dates: 31-Jul-2026 (non-audit); 31-Oct-2026 (audit u/s 44AB). Belated: 31-Dec-2026.
Essential Forms and Reports
Access Form 26AS/AIS via e-filing portal (Dashboard > AIS). AIS expands 26AS with SFT, GST, foreign info, proceedings. Reconcile for accurate filing.
Audit Trigger: Turnover >₹1Cr (business, 75L if cash>5%), >₹50L profession (25L cash). Digital receipts raise limits to ₹10Cr/₹75L.
Tax Rates, Surcharge, and AMT
- Surcharge: 12% if >₹1Cr.
- Marginal Relief: Tax + surcharge ≤ tax@₹1Cr + excess income.
- Cess: 4% on tax + surcharge.
AMT: 18.5% on book profit (if normal tax < AMT) + surcharge/cess. MAT credit available.
Example: ₹1.1Cr income → Base tax ~₹33L; surcharge capped by relief.
Chapter VI-A Deductions: Detailed List
Firms eligible for business-linked deductions:
Why Choose taxbrain.in/?
- End-to-end: ITR prep, audit coord, Form 3CD e-filing.
- Local: Fast, compliant for Maharashtra firms.
- Presumptive/regular: Maximize 44AD benefits.
- Tools: AIS reconciliation, deduction optimization.
Contact for free consultation.
FAQs
Can LLPs use ITR-4 Sugam?
No, only non-LLP firms for presumptive ≤₹50L. LLPs must use ITR-5.
What if turnover exceeds audit limit?
Mandatory 3CA/3CB-3CD by 30-Sep-2026; ITR-5 by 31-Oct. Penalty u/s 271B if missed.
How to claim foreign tax credit?
File Form 67 with ITR-5 details.
Partner salary deductible?
Yes, if reasonable and deed-approved; taxed in partner hands.
Latest ITR changes AY 2026-27?
Enhanced reporting for foreign assets, digital txns in ITR-5.