Facts on Why Every Start-Up Should e-File Income Tax Returns

3
346
Should e-File Income Tax Returns

Embarking on an exciting and equally challenging at the same time, start-ups are gradually changing the corporate face of India by not only modifying the conduct of business but also the manner in achieving positive results. Managing a start-up however required countless hours of hard work, rigorous planning and compromises.Facts on Why Every Start-Up Should e-File Income Tax Returns.

Every Start-Up Should e-File Income Tax Returns

Download Click Here and use our IOS App to file your Income Tax Return

One of the most important things to be aware in running start-ups is taxation. Many entrepreneurs either ignore intentionally or non-intentionally about the significance of taxation. You cannot afford to neglect taxation. The matter of fact is that filing tax returns will instead help in the growth of your start-up.

Download Click Here and use our Android App to file Income Tax Return

Filing for tax return will vary on the type of start-up, depending on whether it is registered as a Partnership Firm, Limited Liability Partnership (LLP) or a Private Limited Company. For Sole Proprietorship start-ups, you must file tax returns as an individual. Sole Proprietorship start-ups can also avail the benefit of the Rs. 2.5 Lakhs exemption limit that is applicable to individual taxpayers. For others, there will be no exemption limit and you will have to pay the income tax on any income earned by the company.

Here are a couple of reasons why start-ups should e-file Income Tax Returns.

For Redeeming any Losses

The initial years of every start-up is the building phase where you will somehow experience losses in the company’s fund. This case is pertinent to every business. It will eventually take a few years of establishment and operation for a start-up to begin seeing profits in its balance sheet. There is, however, a way to manage these losses. These losses can be paid off in the coming years when your start-up catches up and starts bringing-in profits. Although to avail this benefit, the start-up must e-file its income tax return citing the losses so that it can be redeemed later-on.

Filing Income Tax Return

Loan Application for Start-Ups

Like for individual taxpayers, a start-up must also submit its income tax return if it wants to apply for a loan. Submitting the income tax return verifies the authenticity and existence of the company. All the financial institutions that sanction loans for start-ups will ask for the submission of your company’s income tax returns from the previous years’.

For Availing Funding

For a start-up to grow, a growth in the capital is required and this is achievable through funding. Start-ups generally approach investors, venture capitalists etc. for raising their funds. The investors would require you to submit your company’s income tax returns from the previous years to gain a perspective of your business’s book value and decide on the amount which will be funded. This is another fact which will encourage a start-up to e-file income tax return.

For Resolving Disputes Between Partners

If the founding members or partners of the start-up end up experiencing differences or facing clashes on the way of operating the business and decide to part ways, income tax return becomes very helpful. The company’s income tax return will even solve disputes between the start-up and its external parties on monetary issues.

E-filing income tax return can help your start-up achieve structure and growth as well as represent the genuineness of your company.

SHARE
Previous articleTop 5 reasons for Good Bookkeeping
Next articleDo Students Need to Pay Income Tax?
All India ITR
All India ITR, one of India’s leading tax prep websites offering personal tax solutions focussing on income tax return filing through tech platforms, be it the web, Android or iOS, is dedicated to making tax returns as easy and convenient and yet as complete as possible. With value added services to help maximise tax savings and minimise tax outgo and tax investment advice the comparative advantage of specialization allows us to uniquely serve our clients. All India ITR is certified to conduct E-return intermediary services by the Income Tax Department of India.

3 COMMENTS

  1. Thanks for Nice and simplified blog with hands on. Great work by ITR team it really nice to explaining everything about taxes Thanks a lot! Great Presentation did not faced not even single mistake while doing practicals for the same.looking for such more blog.It’s really great that u take initiative to tell people about this and your way of representation of thought is really good.We can understand out problem very easily and get our answers faster. Excellent team work by All India ITR. Very easy to understand with all the clarity. Excellent team work by All India ITR.Great work by ITR team it really nice to explaing everything about taxes.
    Thnx for this this really help me alot.This blog is really helpfull for us to know more about ITR. This tell us everything that we should know about ITR. This is like a algorithm to fill taxes becaute it tell us step by step how we should fill taxes and yes it is also easy to understand. It tell breifly and accurately about taxes. The best thing about this blog is that we can get every information hear only. we shoud not go on different side to search about itr. It’s really great that u take initiative to tell people about this and your way of representation of thought is really good.We can understand out problem very easily and get our answers faster.Great keep it up.

  2. excellent piece of information.
    Thank you for your great article .It is the clearest i have found and i am sure it is going to help me a lot as a common Indian citizen and entrepreneur.the most important things to be aware in running start-ups is taxation. Many entrepreneurs like me either ignore intentionally or non-intentionally about the significance of taxation since we cannot afford to neglect taxation. The matter of fact is that filing tax returns will instead help in the growth of your start-up.
    It’s really great that u take initiative to tell people about this and your way of representation of thought is really good.
    We can understand out problem very easily and get our answers faster.

  3. Thanks this blog has really helped me alot. This really helps and tells a process that is required to fill up an Income tax return. This blog tell us step by step how we should fill taxes and yes it is also easy to understand. Each and every details have been mentioned in simple and clear language.
    i would prefer anyone to have a eye on it to clear all their doubts. The best thing about this blog is that we can get every information hear only. we shoud not go on different side to search about itr. Great work keep it up.It tell breifly and accurately about taxes. The blog is very detailed and the way it explains the things is very easy to understand and to retain it really helps a person on how to fill up the ITR and how to enquire about it. Great work from ALL INDIA ITR since it is a very well written and a very useful blog.

LEAVE A REPLY

Please enter your comment!
Please enter your name here