22 May 2017
Yes till the date of dissolution you have to prepare Financials and settle all liability dispose all fixed assets settle applicable taxes on income till dissolution date, and any statutory outstanding.
21 July 2024
If a firm is dissolved during the year, it is generally required to file a final income tax return. Here’s a step-by-step procedure you can follow for filing the return:
1. **Obtain Necessary Documents:** - Gather all financial statements, accounting records, and other relevant documents up to the date of dissolution. - Ensure you have details of income, expenses, assets, liabilities, and any other financial transactions for the period up to the dissolution date.
2. **Prepare Financial Statements:** - Prepare the final financial statements of the firm up to the dissolution date. This includes: - Income Statement (Profit and Loss Account) - Balance Sheet
3. **Compute Taxable Income:** - Calculate the firm’s taxable income for the period up to the dissolution date based on the financial statements prepared.
4. **Prepare and File Income Tax Return:** - Use the appropriate form for filing income tax returns applicable to a dissolved firm (usually Form ITR-6 for companies or Form ITR-5 for firms). - Fill in the details of income, deductions, and tax computation based on the financial statements prepared up to the dissolution date. - Ensure to mention the dissolution date prominently in the return where required.
5. **Declare Dissolution:** - Declare the dissolution of the firm in the return. There may be specific fields or schedules in the return form where you need to mention the date of dissolution and provide details about the dissolution process.
6. **Pay Taxes Due:** - Calculate the tax liability for the firm up to the dissolution date. - Pay any taxes due before filing the return, if applicable.
7. **File the Return:** - Once the return is prepared and all details are verified, file it electronically on the Income Tax Department’s e-filing portal. - Attach the necessary documents and schedules as required by the form.
8. **Post-filing Compliance:** - After filing, keep copies of the filed return and supporting documents for future reference. - Respond to any notices or communications from the Income Tax Department related to the filed return.
9. **Closure of Tax Matters:** - Ensure that all tax matters related to the firm are properly closed, including clearance of any tax liabilities and filing of necessary documents with the tax authorities as per their requirements.
If you are unsure about any specific requirements or forms to be used, it’s advisable to consult a tax professional or chartered accountant who can guide you through the process and ensure compliance with tax laws and regulations.
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