Tax paid by a company is a direct result of its income. The more income the higher the amount of tax paid. The calculation of taxes for companies in India depends on various factors, such as the type of tax, the company’s income, expenses, deductions, and exemptions, among other things.
Here is a brief overview of some of the most common types of taxes that companies in India are required to pay:
- Corporate Income Tax: Companies are required to pay income tax on their profits earned during the financial year. The tax rate for companies with a turnover of up to Rs. 400 crores in the financial year 2021-22 is 25%. For companies with a turnover exceeding Rs. 400 crores, the tax rate is 30%.
- Minimum Alternate Tax (MAT): MAT is a tax imposed on companies that show a book profit but have not paid any tax due to exemptions, deductions, or incentives. The tax rate for MAT is 18.5%.
- Dividend Distribution Tax (DDT): Companies are required to pay DDT on the dividends they distribute to their shareholders. The tax rate for DDT is 15%, and it is deducted by the company before distributing the dividends.
- Goods and Services Tax (GST): GST is a consumption-based tax that is levied on the supply of goods and services. It is paid by the company while selling its products or services and is claimed as input tax credit against the tax liability on the output.
- TDS: Tax Deducted at Source (TDS) is a tax that is deducted by the company while making certain payments such as salaries, rent, commission, etc. The amount of TDS is paid to the government and is credited to the recipient’s account.
- Custom Duty: Custom Duty is a tax levied on goods imported into India. The tax rate depends on the type of goods and the country of origin.
- Excise Duty: Excise Duty is a tax imposed on the production or manufacture of goods in India. The tax rate depends on the type of goods.
We have curated the list of the top 10 tax paying companies in India, here is the list:
- Tata Consultancy Services (TCS) – ₹11,536 crores
- Tata Steel – ₹11,079 crores
- JSW Steel – ₹8,013 crores
- Life Insurance Corporation of India (LIC) – ₹7,902 crores
- Reliance Industries – ₹7,702 crores
- Indian Oil Corporation – ₹7,549 crores
- Infosys – ₹7,260 crores
- ITC – ₹4,771 crores
- Hindustan Zinc – ₹4,471 crores
- NTPC – ₹4,336 crores
Companies may also be required to pay other indirect taxes, such as stamp duty, property tax, and professional tax, among others. The calculation of these taxes may vary depending on the specific tax laws and regulations in India.
Answering the FAQs related to tax filing in India:
- What is the due date for filing income tax returns for companies in India?
Answer: The due date for filing income tax returns for companies in India is 30th September of the assessment year.
2. How can a company make tax payments in India?
Answer: A company can make tax payments in India through online modes such as net banking, credit card, or debit card.
3. What is the tax rate for companies in India?
Answer: The tax rate for companies in India is 25% for companies with a turnover of up to Rs. 400 crores in the financial year 2021-22. For companies with a turnover exceeding Rs. 400 crores, the tax rate is 30%.
4. Is it mandatory for companies in India to obtain a tax audit?
Answer: Yes, it is mandatory for companies in India to obtain a tax audit if their turnover exceeds Rs. 1 crore in the financial year.
5. Can companies in India claim deductions for charitable donations?
Answer: Yes, companies in India can claim deductions for charitable donations made to institutions or funds specified under section 80G of the Income Tax Act.
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