Income Tax Compliance for Businesses2025: What You Need to Know

As businesses gear up for the financial year 2025–26, staying on top of Income Tax Compliance in India is more critical than ever. With evolving tax rates, new procedural requirements, and stringent documentation norms, companies must navigate a complex regulatory landscape to avoid penalties and optimise their tax position.

At PKPConsult, our team of chartered accountants brings deep expertise and personalised support. We ensure your business not only meets every compliance obligation but also leverages available benefits to the fullest.

Understanding Tax Rates and Regimes

Corporate Tax Rates

• Domestic Companies
  • Turnover ≤ ₹400 crores (FY 2020‑21): 25%
  • Opting under Section 115BAA: 22%
  • New manufacturing firms under Section 115BAB: 15%
  • Other domestic entities: 30%
• Surcharge & Cess
  • Income > ₹1 crore but ≤ ₹10 crore: 7% surcharge
  • Income > ₹10 crore: 12% surcharge (10% for 115BAA/BAB)
  • Health & Education Cess: 4% on tax payable

Presumptive Taxation Scheme

• For businesses with turnover ≤ ₹20 million (₹30 million if cash receipts ≤ 5%) and professionals earning ≤ ₹7.5 million
• Income computation
• Banking/online receipts: 6% minimum taxable income
• Other receipts: 8% minimum taxable income

How Does PKPConsult Help?

• Regime Selection: We analyse your financials and growth plans to recommend the most tax‑efficient regime, be it the concessional rates under Sections 115BAA/115BAB or the regular structure.
• Rate Optimisation: Our experts project your surcharge and cess liabilities. Thus helping you plan investments and expenses to minimise effective tax.
• Presumptive Tax Advisory: For small businesses and professionals, we guide you through eligibility and computation nuances and ensure accurate quarterly instalments.

Navigating Filing Requirements

Key Deadlines

• Tax Returns
  • Businesses requiring audit: October 31, 2025
  • Transfer pricing reports: November 30, 2025
  • Revised returns: December 31, 2025
  • Updated returns (beyond revisions): March 31, 2030
• Switching Tax Regimes
  • File Form 10‑IEA by the due date under Section 139(1)
  • Note: One‑time switch allowed between old and new regimes

How Does PKPConsult Help?

• Compliance Calendar: We set up a customised filing schedule with automated reminders for every due date of returns, audit reports, and regime‑switch forms.
• Form Preparation: Our team drafts and reviews all necessary forms, including Form 10‑IEA, for regime changes. Thus ensuring error‑free submissions.
• Revision Support: In case of overlooked deductions or reporting errors, we handle revised and updated returns to optimise your tax position and avoid interest charges.

Documentation and Record‑Keeping Essentials

Under the new regime of income tax compliance in India, thorough record‑keeping is non‑negotiable. Businesses must maintain:

• Transaction Records: Invoices, purchase orders, receipts, and bank statements
• Expense Documentation: Proof of payments, bills, and vendor contracts
• Deduction Evidence: Employer contributions (Section 80CCD(2)), depreciation schedules, and charity receipts

How Does PKPConsult Help?

• Digital Record Systems: We implement cloud‑based bookkeeping solutions tailored to your industry. Thus enabling real‑time access and audit readiness.
• Expense Reconciliation: Our accountants perform monthly reconciliations, flagging discrepancies before they become compliance issues.
• Documentation Audits: Periodic reviews of your records against statutory checklists ensure that you capture every allowable deduction.

Meeting Audit Requirements

Who Needs an Audit?

• Businesses with turnover > ₹1 crore (₹10 crore if cash receipts ≤ 5%)
• Professionals with gross receipts > ₹50 lakh

Audits must be conducted post-year-end, but proactive preparation is key to a smooth process.

How PKPConsult Helps

• Pre‑Audit Health Check: We conduct mock audits to identify potential gaps in your books and suggest corrective actions well before the statutory deadline.
• Liaison Services: Acting as your representative, we coordinate with auditors, respond to queries, and ensure timely report finalisation.
• Financial Visibility: Through interim reporting and KPI dashboards, we enhance your understanding of financial performance. Thus enabling better decision‑making.

Adapting to Procedural Updates

➢Income Tax Bill 2025 Highlights

• Enhanced Return Forms: Detailed schedules for personal and business disclosures
• Re‑assessment Provisions: Stricter timelines and no separate notices for escaped income
• Dispute Resolution Panel (DRP): Mandated to issue reasoned orders.

➢Business Trusts Compliance

• REITs and InvITs must file Form 64A by June 15 following the fiscal year under revised Rule 12CA (Income Tax Rules, 1962).

How Does PKPConsult Help?

• Regulatory Interpretation: We break down legislative changes into actionable checklists. Thus ensuring you capture every new disclosure requirement.
• Form 64A Filings: Our specialists prepare and submit income distribution reports for REITs/InvITs, liaising with trustees and trusteeship auditors.
• DRP Representation: In case of disputes, we draft submissions and represent you before the DRP, aiming for swift resolution.

Avoiding Penalties for Non‑Compliance

Late filing or payment attracts interest at 1% per month (or part thereof) on unpaid tax. Other penalties include:

• Section 234F: Late filing fees up to ₹10,000 (₹1,000 if income ≤ ₹5 lakh)
• Section 271B: Audit non‑compliance penalty up to 0.5% of turnover

How Does PKPConsult Help?

• Penalty Mitigation: We review prior‑year filings, identify inadvertent defaults, and apply for condonation or reduced penalties where possible.
• Timely Alerts: Automated alerts for every compliance milestone (returns, audits, trust filings) ensure you never miss a deadline.
• Continuous Monitoring: Our compliance dashboard tracks your obligations across all entities and jurisdictions, flagging potential risks in advance.

Income Tax Compliance in India Made Easy with PKPConsult

Income tax compliance in India for FY 2025–26 demands a strategic approach, blending meticulous record‑keeping, timely filings, and deep regulatory insight. By partnering with PKPConsult, you gain more than just a compliance service. You secure a proactive advisor dedicated to optimising your tax position, streamlining processes, and safeguarding your business against penalties.

Ready to simplify your tax journey? Contact PKPConsult today for a personalised consultation and discover how our expert CAs can turn compliance into a competitive advantage.