Filing income tax returns (ITR) is a legal requirement for all company owners. It assures tax conformity and gives a comprehensive picture of your financial activity. However, if you operate many firms under the same Permanent Account Number (PAN), the ITR filing procedure may get more complicated.

How to File an ITR for Multiple Businesses Using the Same PAN?

In this post, we will walk you through the process of filing an ITR for many enterprises under a single PAN.

● Maintain Separate Books of Accounts

Separate books of accounts for each company are essential for simplifying the process of submitting ITRs for various firms. Maintain accurate records of each business's revenue, spending, assets, liabilities, and other financial activities. This split will assist you in determining taxable income and claiming appropriate deductions for each firm separately.

● Determine the Appropriate ITR Form

The Income Tax Department provides numerous ITR forms depending on the sort of business you run. Examine the numerous ITR forms and choose the one that best fits your company. For example, if you own two sole proprietorships, you may be required to submit ITR-3. If one of your companies is a partnership, ITR-5 may be the right structure for you. Examine the instructions for each form carefully to ensure you choose the proper one.

● Calculate Income and Costs Individually

When filing ITR for numerous companies under one PAN, the income and costs for each company must be calculated individually. Total each business's revenue and costs, taking into account all relevant financial transactions. Ensure that you appropriately apportion revenue and costs amongst the firms based on their respective contributions.

● Provide Specifics About Each Firm

When completing your online ITR you must provide specifics about each firm you own. This comprises the company name, location, and kind of business (sole proprietorship, partnership, etc.). You will also need to provide your PAN, GSTIN (Goods and Services Tax Identification Number), and other pertinent information. Check that all of the information supplied is correct and up to date.

● Calculate Tax Obligation Individually

To establish the tax obligation for each firm, compute the taxable income individually based on the previously computed revenue and costs. Consider any relevant business-specific deductions, exemptions, and tax rates. Calculate the tax due individually for each firm and make a note of the calculations for future reference.

● Merge Income and Taxes

Even though you keep separate books of accounts and compute income and taxes separately, you will need to merge the income and tax data for all enterprises under one PAN when submitting ITR tax filing Total the income from all of the companies to determine the combined tax obligation. Include all relevant revenue streams, such as salary, interest, and any sources of income outside the companies.

● Report Business Losses and Carry Forward

If any of your enterprises suffer a loss, the loss must be reported in the ITR filing. While losses from one company cannot be offset against losses from another, they may be carried forward for future adjustment within the same firm. To declare business losses and carry them forward for future years, complete the applicable parts of the ITR form.

● Verification and Submission of the ITR Form

After completing all required calculations and correctly filling out the ITR form, validate the information supplied and double-check for any mistakes or omissions. Sign the form using the proper way, either digitally or manually, according to the instructions. To prevent fines or late fees, submit the ITR before the deadline.

● Obtain Professional Help

Filing ITR for several enterprises under one PAN may be complicated. Thus, it is best to obtain professional help if you need clarification about the procedure. Tax advisors or chartered accountants specializing in taxes may give important advice and guarantee that all legal requirements are met.

Conclusion

ITR filing for several enterprises under one PAN requires careful planning, precise calculations, and respect for tax requirements. You may simplify the procedure by keeping separate books of accounts, using the appropriate ITR form, and reporting the revenue and expenditures for each firm individually. Remember to combine your income and taxes, disclose any losses, and seek expert help if necessary. Following these measures, you can meet your tax duties more efficiently and successfully.