Filing ITR-Form 6 for AY 2025-26? Here's What You Must Know

CBDT Introduces ITR-Form 6 for AY 2025-26: An In-Depth Examination

The Central Board of Direct Taxes (CBDT) has formally issued ITR-Form 6 for the Assessment Year (AY) 2025-26, aligning it with the financial year 2024-25. This announcement, made under Notification No. 44/2025, establishes the guidelines for companies (excluding those claiming exemption under Section 11) to submit their income tax returns. This blog post will explore the crucial elements of this announcement and its implications for businesses operating in India.

Clarifying ITR-Form 6: Who is Required to File?

ITR-Form 6 is tailored for companies, with the exception of those seeking exemption under Section 11 of the Income Tax Act, 1961. Section 11 relates to income derived from properties utilized for charitable or religious reasons. Thus, all other private or public companies must utilize this form to file their income tax returns for AY 2025-26.

Noteworthy Changes and Considerations for AY 2025-26:

Although the official announcement may not always define major shifts year-on-year, it is essential for businesses to remain informed about any updates or new obligations integrated into ITR-Form 6 for AY 2025-26. Reflecting on recent trends and regulatory adjustments, here are some aspects that companies should closely monitor:

Disclosure of Digital Assets:

Given the rising significance of virtual digital assets (VDAs), including cryptocurrencies and NFTs, the tax authorities have shown an interest in monitoring transactions related to these assets. It is highly probable that ITR-Form 6 for AY 2025-26 will include specific sections dedicated to reporting income derived from VDAs, capturing details on acquisitions, transfers, and the consequent gains or losses.

Adherence to Transfer Pricing Regulations:

For companies involved in international transactions or specified domestic dealings with associated enterprises, compliance with transfer pricing laws is critical. ITR-Form 6 will continue to demand thorough disclosures concerning these transactions, including the arm's length price and the methodologies employed for its determination. Any recent amendments to transfer pricing legislation will likely be incorporated into the form.

Disclosure of Corporate Social Responsibility (CSR) Expenditures:

Companies that meet the established threshold are required to engage in CSR activities. ITR-Form 6 will need detailed reporting of the CSR spending incurred over the financial year to ensure adherence to Section 135 of the Companies Act, 2013.

Income Reporting from Various Sources:

The form will persist in requiring extensive disclosure of income across different categories, such as business and professional income, capital gains, and other income types. Companies must ensure the accurate and complete reporting of all their income sources.

Deductions and Allowances:

Companies have the opportunity to claim a variety of deductions and allowances per the Income Tax Act. ITR-Form 6 will present schedules for these deductions, such as those outlined in Chapter VIA (for instance, Section 80G, 80IA, etc.) and other business-specific deductions. It is vital to verify that all claimed deductions are legitimate and backed by appropriate documentation.

Tax Calculation and Payment Information:

The form will feature sections for calculating the total tax liability, including any applicable Minimum Alternate Tax (MAT). Companies will also need to share details of all tax contributions made throughout the financial year, such as advance tax, self-assessment tax, and tax deducted at source (TDS).

Audit Information:

Companies obligated to have their accounts audited according to the Income Tax Act or the Companies Act will need to provide information about the auditor, the audit report, and essential financial details based on the audited financial statements.

New Schedules or Reporting Requirements:

It is always wise to carefully examine the released form for any new schedules or reporting guidelines that may have been added for AY 2025-26 due to recent legislative changes or clarifications.

Significance of Timely Submission:

It is essential for companies to comply with the deadlines set for filing ITR-Form 6. For companies not obligated to have their accounts audited, the filing deadline is generally October 31st of the assessment year. Conversely, companies required to undergo an audit typically need to file by November 30th of the assessment year. Not meeting these deadlines may result in penalties and interest under the provisions of the Income Tax Act.

Staying Informed:

To maintain accuracy and timeliness in compliance, companies and their tax consultants should:

• Download the official notification along with ITR-Form 6 from the Income Tax Department's website.
• Diligently examine the instructions that come with the form to grasp the specific requirements for AY 2025-26.
• Remain updated on any clarifications or circulars published by the CBDT regarding the new form.
• Ensure that their accounting systems and processes align with the reporting standards outlined in ITR-Form 6.

Conclusion:

The announcement of ITR-Form 6 for AY 2025-26 represents a crucial milestone in the tax filing process for Indian companies. By comprehending the details of this form and keeping abreast of any new requirements, businesses can facilitate efficient and compliant tax filing, steering clear of potential penalties while concentrating on their primary operations. It is always advisable to seek advice from tax professionals for tailored guidance that reflects the unique circumstances of your company.

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