Frequently asked Questions on BIT & CIT
Frequently asked Questions for BIT/CIT
Where do I submit Tax Returns?
Can the time limit be extended?
What conditions should be met to avail of the allowable deductions for CIT/BIT?
What are the fines and penalties?
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Who is liable for CIT & BIT?
All companies incorporated under the Companies Act 1989 and registered with the Ministry of Trade and Industry.
All business units holding a trade license issued by the Ministry of Trade & Industry.
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What are the Tax rates?
CIT/BIT is levied at a rate of 30% on the Net Profit of the company or business units in each calendar year, also called income year.
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When do I submit Tax Returns?hen do I submit Tax Returns?
All companies and businesses must submit their tax return between 1st January and 31st March following the income year.
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Where do I submit Tax Returns? do I submit Tax Returns?
To the Regional Revenue & Customs Office where the taxpayer is registered.
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What do I submit?What do I submit?
The following documents must be submitted:
• Annual Corporate/Business Income Tax Return (Form IT-10)
• Annual Accounts (Form IT-7)
• Details of taxes paid/deducted at source for the company/business but not for employees(if applicable)
Note:
Annual Accounts must include Trial Balance, Profit & LossAccount, Manufacturing/Trading Account, Balance Sheet.
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Can the time limit be extended?mit be extended?
YES. When a taxpayer is unable to submit the Tax Return within the scheduled time due to unavoidable circumstances, the taxpayer must make a provisional tax payment based on the previous income year's final tax liability along with a written application requesting an extension of time. These must be submitted before 20th March to the concerned Regional Director. The RRCO can extend the time limit till 31st May. Request for further extension should be referred to DRC, HQ.
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Taxes must be paid when you submit your Tax Return. However, all notified large and medium CIT and BIT units must pay tax on a half-yearly basis as Advance Tax by 31st August of the income year. The Advance Tax should be based on a half-yearly profit & Loss Account (covering the 6 months January to June of the current income year) or 50% of the CIT/BIT paid in the previous year. The Advance Tax paid by a unit during the tax year will automatically be adjusted at the time of filling the annual Tax Return.
Dates for tax Payment & submission of annual Tax Returns:
Category Submission Date: Annual Return & Tax payment Payment Date of Advance Tax
Large 1st January to 31st March 1st July to 31st August
Medium 1st January to 31st March Not Applicable
Cottage 1st January to 31st March Not Applicable
Note:
On submission of Tax Returns and payment of provisional tax, Tax Clearance Certificate (TCC) will be issued by the RRCOs to enable the renewable of business Licenses with the Ministry of Trade & Industry. In case of business units with outstanding taxes, TCC will be withheld until all dues have been cleared/paid.
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