We are focusing on ITR-6—the income tax return form that is pertinent for most companies. Now that we have the Assessment Year (AY) 2025-26 before us (aligning with Financial Year 2024-25), here are some significant changes that might influence the way you file.
Who Needs to File ITR-6? Applicability Explained
ITR-6 is tailor-made for those companies registered under the Companies Act, 2013 (or prior versions). That means private limited companies, public limited companies, one-person companies (OPCs), and even foreign companies with income earned in India and taxable in India. But not for all—companies availing exemptions under Section 11 of the Income Tax Act (such as charitable or religious trusts) do not have to file this form and must go in for ITR-7 instead.
Important rules of applicability:
- Compulsory for Every Eligible Company: If your company is a “company” under Section 2(17) of the Income Tax Act and does not enjoy Section 11 exemptions, ITR-6 is your ideal form, irrespective of income. Even loss-incurring companies are required to file if they are compellable under Section 139(1).
- No Income Threshold Limit: There is no income limit, unlike in individual ITRs; entity type is the criterion.
- Residency Status: Both resident and non-resident companies having income from India.
- Exclusions: Proprietorships, partnerships, LLPs, or firms utilize ITR-5. Individuals or HUFs opt for ITR-1 to ITR-4.
Major ITR-6 Changes for AY 2025-26
The CBDT has introduced various modifications to ITR-6 through Notification No. 44/2025 dated May 6, 2025, to reflect the Finance Act, 2024. The changes focus on transparency, particularly in capital gains, ESG reporting, and adherence to new tax regimes. Here is the break-up:
- Improved Capital Gains Reporting: A more comprehensive schedule of capital gains now mandates different reporting of short-term and long-term gains. The LTCG rate has risen from 10% to 12.5%, STCG from 15% to 20%, effective July 23, 2024. Moreover, capital losses arising on share buybacks are now permissible, with proceeds accounted as ‘Nil’ consideration in capital gains but under ‘Income from Other Sources’ if corporate tax has been incurred.
- New Reference to Section 44BBC: This brings in presumptive taxation for some shipping companies, enabling firms to calculate profits at 7.5% of gross receipts without full books.
- ESG and CSR Disclosures: Companies are now required to disclose Environmental, Social, and Governance (ESG) activities and Corporate Social Responsibility (CSR) expenditure, including unspent balances brought forward.
- Audit Trail and Foreign Remittances: Compulsory revelation of audit trail upkeep under Companies Act and specifics of outward foreign remittances through Form 15CC.
- Alterations in Schedule BP: Business profits now include adjustments for buyback loss and presumptive schemes more clearly.
- Raised Threshold for Assets/Liabilities: The disclosure threshold of schedule AL (Assets and Liabilities) has been increased, alleviating the burden for smaller businesses.
Rules and Regulations for Filing ITR-6
Preparation of ITR-6 is regulated under Sections 139 to 153 of the Income Tax Act. Some of the principal rules are:
- Due Date: Initially July 31, 2025, but later extended to September 15, 2025, through CBDT Circular No. 06/2025 dated May 27, 2025, due to form changes and portal issues.
- Mode of Filing: Solely electronic—through the income tax e-filing portal based on a digital signature (DSC) for companies.
- Audit Mandates: Where turnover is more than Rs. 1 crore (or Rs. 10 crores in the case of digital transactions >95%), tax audit under Section 44AB is compulsory. Append Form 3CD.
- CBDT Guidelines: Verify pre-filled information from Form 26AS and AIS. Delayed filing incurs a fee of Rs. 5,000 (Rs. 1,000 if income < Rs. 5 lakh) plus 1% interest per month under Section 234A.
- Updated Returns: Apply ITR-U for reconciliation up to two years ago, according to Notification No. 127/2025.
Step-by-Step Process: How to Submit ITR-6 on the Income Tax Portal
Filing ITR-6 includes download of Excel utility, completion of schedules, and upload. Here is how to do it:
1.Register/Login: Go to https://www.incometax.gov.in/iec/foportal/. Use PAN of your company as User ID and register in case new.
2.Download Utility: Navigate to ‘Downloads’ > ‘Income Tax Returns’ > Select ITR-6 Excel Utility for AY 2025-26 (released Aug 14, 2025).
3. Fill Basic Details: Input company details, audit status, and select tax regime (e.g., Section 115BAA for flat rate of 22% if eligible).
4. Fill Schedules:
5. Schedule BP: Adjustments of business income.
6. Schedule CG: Capital gains with new rates and buyback information.
7. Schedule OS: Other incomes, foreign remittances etc.
8. New additions: ESG/CSR sections and Section 44BBC if used.
9. Check pre-filled data from 26AS.
10. Calculate Tax: Utilize the utility’s auto-calculation for tax liability, deductions (such as 80G for charitable donations), and taxable income.
11. Validate and Create JSON: Click ‘Validate’ to identify errors, followed by ‘Generate JSON’.
12. Upload on Portal: Log in > ‘e-File’ > ‘Income Tax Returns’ > ‘File Income Tax Return’ > Upload JSON > Sign using DSC > Submit.
13. E-Verify: Within 30 days through DSC or EVC.
If there are problems, see Circular No. 8/2025 for explanations of validations. In a recent case illustration of a client, a logistics firm avoided hours of drudgery using pre-filled data but made manual adjustments for buyback losses.
Tax Calculation for ITR-6: With Examples
Tax for firms under ITR-6 varies based on the regime opted for. Base rates:
- Domestic companies: 30% (25% if turnover ≤ Rs. 400 crores in FY 2022-23).
- Voluntary regimes: 22% under 115BAA (no exemptions) or 15% under 115BAB (manufacturing installations).
- Surcharge: 7% if income > Rs. 1 crore, 12% > Rs. 10 crores; Health & Education Cess: 4%.
Step-by-Step Calculation:
1.Gross Total Income (GTI): Add business profit, capital gains, others.
2.Sacrifice allowable deductions/expenses (e.g., depreciation under Section 32).
3.Impose regime-specific rates on Taxable Income.
4.Add surcharge/cess; deduct TDS/TCS/advance tax.
Example 1: Normal Domestic Company
- Company ABC Pvt Ltd (turnover Rs. 300 crore): Business profit Rs. 50 crore, capital gain Rs. 5 crores (LTCG from July 2024 onwards).
- Taxable Income: Rs. 55 crores (no deductions waived).
- Tax Rate: 25% = Rs. 13.75 crores.
- Surcharge (7%): Rs. 0.9625 crores.
- Cess (4%): Rs. 0.5885 crores.
- Total Tax: Rs. 15.301 crores. This is consistent with new LTCG rates; if not for the increase, it would have been lower by ~Rs. 0.125 crores.
Example 2: With Buyback Loss and Presumptive Taxation
- XYZ Shipping Ltd: Gross receipts Rs. 100 crores (avails Section 44BBC: 7.5% deemed profit = Rs. 7.5 crores).
- Capital loss on buyback: Rs. 2 crores (allowed now).
- Taxable Income: Rs. 5.5 crores.
- Tax @30%: Rs. 1.65 crore + cess/surcharge. In a case study, such a similar firm lowered liability by 20% through this presumptive route, according to Notification No. 44/2025.
Author Bio
