What Are The Tax Implications For A Private Limited Company?

Tax Implications for Private Limited Companies in India

1. Corporate Income Tax: Private Limited Companies must pay corporate income tax on their taxable income.

2. Goods and Services Tax (GST): Companies need to register for GST if their turnover exceeds the prescribed limit.

3. Dividend Distribution Tax (DDT): DDT was abolished, and dividends are now taxed in the hands of the shareholders.

4. Tax Deducted at Source (TDS): Companies must deduct TDS on certain payments and deposit it with the government.

5. Advance Tax: Companies are required to pay advance tax in installments based on their estimated income.

6. Transfer Pricing Regulations: Companies engaging in international transactions must comply with transfer pricing regulations.

7. Minimum Alternate Tax (MAT): Companies may be liable to pay MAT if their tax liability under regular provisions is lower than a certain percentage of their book profit.

8. Compliance with Tax Audit: Companies with a turnover exceeding a specified limit are required to undergo a tax audit.

9. Compliance with Annual Information Return (AIR): Companies may be required to file an Annual Information Return for specified high-value transactions.

10. Compliance with Anti-Avoidance Rules: Private Limited Companies need to comply with anti-avoidance rules to prevent tax avoidance practices.