What is ITR?

An ITR is an Income Tax Return, a document prescribed under law that is filed by a taxpayer before the Indian Income Tax Department declaring among other things income amounts, tax deductions, and total tax against income earned by either an individual or entity under any of the financial years. Filing ITR is meant to offer transparency in an individual's adherence to the tax laws of that country. There are different types of ITR forms available depending on the income type and taxpayer category. ITR-5 is only meant for firms, LLPs, AOPs, BOIs, or any such entity; it does not cover individuals, HUFs, or any companies filing other ITRs.

Besides individual taxpayers, the ITR-5 is a form of income tax return for firms, LLPs, AOPs, BOIs, estates of trusts, cooperative societies, business trusts, and other artificial persons. It does not cover Individuals, Hindu Undivided Families, or the ones who are applying for ITR-7.

Eligibility Criteria For ITR 5 form online in India

The ITR-5 Form is applicable to the following entities:

• Partnership Firms and Limited Liability Partnerships

ITR-5 applies to business partnership firms and LLPs registered under the LLP Act, 2008 which are not taxed in the capacity of companies for booking income and taxes.

• Association Of Persons (AOP) / Body of Individuals (BOI)

Unregistered gatherings of individuals or persons who have assembled for a common goal and collect income together must file ITR-5.

• Estates Of Deceased/ Insolvent Persons

Any legal representatives of a deceased person or handling the income or liabilities of an estate of an insolvent person are still entitled to use ITR-5.

• Business Trusts And Investment Funds

Trusts or investment funds that are registered under SEBI regulations or relevant provisions of the Income Tax Act such as 115UA or 115UB can file their returns through ITR-5.

• Cooperative Societies

Cooperative societies set up under the Co-operative Societies Act and deriving income by various means are entitled to use ITR-5.

• Local Authorities

Local Authorities such as municipalities or district councils earning taxable income would require filing ITR-5.

• Artificial Juridical Persons (AJPs)

These are the entities that are recognized as legal persons but not as natural persons. Deities, universities, etc., are possible examples of AJP that would not fall under ITR-7.

Who Cannot File ITR-5:

• Individuals:

Salaried individuals or any persons with personal income file ITRs from 1-4, depending on the individual case.

• Hindu Undivided Families (HUFs):

HUFs file returns under ITR-2 or ITT-3, depending on the nature of income.

• Companies:

All registered companies under the Companies Act are required to file returns under ITR-6 or ITR-7 (in specified cases).

• Entities Required to File ITR-7:

Trusts, political parties, research institutions, etc., that apply for exemption under sections 11, 12, and 10(23C), etc., are required to file under ITR-7.

Benefits of Filing ITR-5

• It assures legal tax compliance for partnerships, LLPs, and all other non-individual entities, thereby ensuring regulatory compliance for such entities. 
• It enables declaring income from various heads, like business or profession, capital gains, house property, and other sources. 
• It allows claims of deductions under the Income Tax Act in which the tax liability of such entities is computed. 
• It ensures that eligibility to carry forward the business loss, unabsorbed depreciation, and claim for TDS credits is not lost, thus decreasing tax liability in the future. 
• It creates a credible history of the business, which can help in loans, funding, or government tendering.

The Tax and Filing Process—Step-by-Step

Gather Preparatory Documents:

• PAN and details of the entity (LLPIN for LLPs)
• Financial statements: Balance Sheet, Profit & Loss, audit reports if applicable
• TDS certificates, bank statements, and Form 26AS are comparable.

ITR-5 Online Filing:

1. Log in to the Income Tax e-filing portal
2. Download the ITR-5 form for the relevant assessment year
3. During the defined sequence, fill out Part A (General Info), Schedules (HP, BP, DPM), Part B (Income & Tax), and Part C (Verification): Part A→Schedules→Part B→Verification 
4. Validate the entries and generate XML, then upload the XML via the e-filing portal.

Verification:

Electronic Verification:

• Through Digital Signature, through EVC or through Aadhar OTP
• Send the signed ITR-V acknowledgement to the CPC Bengaluru within 120 days post e-filing.

Due Dates:

• 31st July: For entities not requiring audit
• 31st October: For audited entities under section 44AB
• 30th November: If audit report in Form 3CEB is needed

Necessary Documentation

• It includes a PAN Card, 
• LLPIN, 
• Balance Sheet along with P&L accounts, 
• Audit Report (if Audited under 44AB), 
• TDS Certificates and Form 26AS, 
• Income details along with Bank Statements, 
• and Proof of Identification of Signatory (PAN, Aadhar).

Procedure for filing ITR-5 form

1. Collection of all documents such as financial statements, PAN, LLPIN (if
   applicable), TDS certificates, and Form 26AS.
2. Log in to the official Income Tax e-filing website, www.incometax.gov.in.
3. Download the ITR-5 for the year of assessment.
4. Fill up Part A (General Info), relevant Schedules, Part B (Income & Tax Details), and Part C (Verification) in a correct manner.
5. Validate then generate XML and upload it to the portal.
6. E-verify the return using DSC, Aadhaar OTP, or EVC or send the signed ITR-V to CPC Bengaluru.
7. Keep the ITR-V acknowledgment with all related documents for your records. 

Note: TDS certificates, audit reports, or any other annexes are not required to be attached with the ITR-5 return; otherwise, they shall not be accepted. 

Components in ITR-5 

• Business/Profession Income 
• Capital Gains (Short & Long-Term) 
• Income From House Property 
• Income From Other Sources 
• Deduction as per the applicable sections 
• Advance Tax/TDS/Self-Assessment Tax details 
• Audit reports, depreciation schedules, and financial computations 

Why Services Plus for ITR 5 form online in India? 

• Professional guidance regarding the layout & details of ITR-5 
• End-to-end assistance in filing the online ITR-5 form in India 
• Verification of eligibility criteria, documentation, and assistance in tax-calculation 
• Complete assistance from registration to verification & submission