ITR-5 — Partnership Firms, LLPs &
Other Entities — Filing Guide
- ITR-5 is the Income Tax Return form filed by Firms, LLPs, AOPs, BOIs and other non-individual entities — excluding Companies and Trusts who have their own separate forms.
- It is the official way for these entities to report their total income, claim deductions, pay due taxes, and stay legally compliant with the Income Tax Department of India.
- Filing ITR-5 on time ensures the firm avoids penalties, can carry forward losses, and keeps its financial records clean for banking, GST, and compliance purposes.
- ITR-5 covers all heads of income — business/profession, house property, capital gains, and other sources — at the entity level.
Partnership Firm
Registered or unregistered firms with two or more partners carrying on any business or profession.
LLP — Limited Liability Partnership
LLPs registered under the LLP Act 2008 — incorporated with ROC and having an LLPIN.
AOP / BOI
Association of Persons or Body of Individuals — a group jointly earning income, taxed as a unit.
AJP / Estate of Deceased
Artificial Juridical Person or estate of a deceased person managed by a legal heir or administrator.
Business Trust
SEBI-registered business trusts such as REITs and InvITs — file under ITR-5 with special provisions.
Investment Fund
Category I and II Alternate Investment Funds (AIFs) registered with SEBI — file ITR-5.
| Entity Type | Correct ITR Form | Important Note |
|---|---|---|
| Partnership Firm | ITR-5 | Register deed u/s 184 for remuneration deduction |
| LLP | ITR-5 | File with ROC — Form 8 and Form 11 annually |
| AOP / BOI | ITR-5 | Taxed at maximum marginal rate if member's rate is higher |
| Individual / HUF with Business | ITR-3 or ITR-4 | NOT ITR-5 — different forms for individuals |
| Private / Public Company | ITR-6 | Companies use ITR-6, not ITR-5 |
| Charitable Trust / NGO | ITR-7 | Trusts with Sec 12AB registration use ITR-7 |
| Document / Record | What It Is & Why It Is Needed |
|---|---|
| PAN of Firm / LLP / Entity | Mandatory identity. PAN must be in entity's name — not partner's PAN. |
| Partnership Deed / LLP Agreement | Core legal document. Must be registered u/s 184 (Firms) or filed with ROC (LLPs) for deductions. |
| PAN of All Partners / Members | PAN of every partner including sleeping/dormant partners. Mandatory disclosure in ITR-5. |
| Profit & Loss Account — FY 2025-26 | Complete income and expenditure for the year. Must reconcile with GST turnover (GSTR-1). |
| Balance Sheet as on 31 March 2026 | All assets and liabilities. IT Act WDV for fixed assets — not Companies Act depreciation. |
| All Bank Account Statements | Every bank account of the entity for Apr 2025 — Mar 2026. Closing balance must match books. |
| GST Returns (GSTR-1, 3B, 9) | Reconcile IT turnover with GST turnover. Differences must be documented and explainable. |
| Form 26AS of Entity | Login with firm's PAN. Verify TDS from clients (194J/194C) and advance tax paid by firm. |
| Tax Audit Form 3CB & 3CD | Mandatory if turnover > Rs.1 Cr (firm) or contribution > prescribed limit (LLP). Filed by CA before ITR. |
| Advance Tax Challans (Challan 280) | All 4 quarterly payments in firm's PAN. Verify they appear in Form 26AS Part C. |
Partner Remuneration — Sec 40(b)
Deductible ONLY if specified in the registered partnership deed. Working partners only — sleeping partners NOT eligible.
Limit: 90% of Book Profit (first Rs.6L) + 60% of balance. If Book Profit is negative — max Rs.3L allowed.
Interest on Partner's Capital — Sec 40(b)
Deductible at maximum 12% per annum on opening capital balance. Must be stated in the deed.
Excess interest paid beyond 12% p.a. is DISALLOWED and added back in tax computation.
Partner's Share of Profit — Sec 10(2A)
A partner's share of the firm's profit is EXEMPT from tax in the partner's individual ITR. Tax is paid by the firm at 30% flat rate. Partner does not pay tax again on profit share.
TDS on Remuneration to Partners
Remuneration paid by firm to partners is taxable in partner's hands as business income — NOT as salary.
Firm deducts TDS u/s 194 @10% if remuneration to any partner exceeds Rs.30,000 per year.
Consultation & Document Collection
We understand the firm's structure — partners, PSR, nature of business. Collect partnership deed, P&L, balance sheet, GST returns, bank statements, TDS certificates, and Form 26AS of the entity.
⏱ 1-2 daysReview, Computation & Sec 40(b) Working
Our experts verify financials, compute IT Act depreciation, verify partner remuneration within 40(b) limits, check MSME dues, cash payment disallowances, and compute net taxable income of the firm.
⏱ 1-2 daysFiling & Submission
We file ITR-5 securely on the official Income Tax e-Filing portal using the firm's PAN and authorized signatory's DSC or EVC. Audit report (if applicable) uploaded before ITR submission.
⏱ Same day once readyVerification & Ongoing Support
We guide verification via DSC or net banking EVC. Assist with refund tracking, advance tax planning for next year, TDS returns, and responding to any IT department notices.
⏱ 1-3 days| Taxpayer Category | Due Date | Notes |
|---|---|---|
| Firm / LLP / AOP / BOI — Non-Audit Cases | 31st August 2026 | Extended deadline effective from AY 2026-27 for business income filers |
| Firms / LLPs — Audit Required (Turnover > Rs.1 Cr) | 31st October 2026 | Tax Audit Report (3CB/3CD) must be filed before ITR |
| Transfer Pricing Cases | 30th November 2026 | International transactions or specified domestic transactions |
| Belated Returns (Sec. 139(4)) | 31st December 2026 | Late filing — penalties and loss carry-forward restrictions apply |
| Revised Returns (Sec. 139(5)) | 31st March 2027 | Correct errors — extended deadline, no additional penalty |
| Tax Component | Rate | Important Note |
|---|---|---|
| Income Tax (Flat Rate) | 30% on Total Income | No slab benefit. Flat 30% from the first rupee of taxable income. |
| Surcharge | 12% of tax | Applicable if total income exceeds Rs.1 Crore |
| Health & Education Cess | 4% of (Tax + Surcharge) | Applied on total tax including surcharge |
| Effective Rate (income >1Cr) | 34.944% | 30% + 12% surcharge + 4% cess |
| Rebate u/s 87A | NOT available | 87A rebate is ONLY for individuals. Firms cannot claim. |
| New Tax Regime u/s 115BAC | NOT applicable | New regime is only for individuals/HUF. Firms always taxed at 30%. |
Unregistered Partnership Deed
If the deed is not registered u/s 184, the firm CANNOT claim deduction for partner remuneration or interest on capital.
Partner Remuneration Exceeds 40(b) Limits
Excess remuneration is disallowed. Many firms pay remuneration without computing the allowable limit first.
GST & IT Turnover Mismatch
If GSTR-1 turnover and ITR turnover differ without explanation — it triggers automatic scrutiny.
Ignoring MSME Dues — Sec 43B(h)
Outstanding dues to MSME suppliers beyond 15/45 days as on 31-Mar-2026 are disallowed.
Cash Payments Above Rs.10,000 — Sec 40A(3)
Single cash payment exceeding Rs.10,000 in one day to one party is 100% disallowed.
Filing Late — Loss of Carry Forward
Business losses CANNOT be carried forward if ITR-5 is filed after the due date.
| Frequency | Compliance | Due Date / Deadline |
|---|---|---|
| Monthly | TDS Deposit (TDS deducted in previous month) | By 7th of each month (30 April for March TDS) |
| Monthly | GSTR-3B Filing + GST Payment (monthly filer) | By 20th of each month |
| Monthly | GSTR-1 Filing (monthly filer) | By 11th of each month |
| Quarterly | TDS Returns (Form 26Q / 24Q) | 31 Jul / 31 Oct / 31 Jan / 31 May |
| Quarterly | Advance Tax Payments | 15 Jun / 15 Sep / 15 Dec / 15 Mar |
| Annual | Tax Audit Report (Form 3CB / 3CD) | 30 September 2026 (if audit required) |
| Annual | ITR-5 Filing — Non-Audit Cases | 31 August 2026 |
| Annual | ITR-5 Filing — Audit Cases | 31 October 2026 |
| Annual | GSTR-9 Annual Return | 31 December 2026 |
| Annual (LLP) | LLP Annual Return (Form 11) | 30 May each year (within 60 days of FY end) |
| Annual (LLP) | LLP Statement of Accounts (Form 8) | 30 October each year |
- Verify ITR immediately via DSC or EVC of managing partner / designated partner — ITR is invalid without verification.
- Track refund status on the e-Filing portal using the firm's PAN login if TDS credits exceed tax liability.
- Save a copy of the filed ITR-5 PDF and ITR-V acknowledgement — required for bank loan applications and next year's filing.
- Begin advance tax planning for FY 2026-27 — first instalment due 15 June 2026.
- File revised return (Sec. 139(5)) if any error is discovered — allowed until 31 March 2027.
PAN of Firm / Entity | Partnership Deed / LLP Agreement | PAN of All Partners
P&L Account + Balance Sheet | All Bank Statements | GST Returns | Form 26AS of Firm
Tax Audit Form 3CB/3CD (if applicable) | Advance Tax Challans | TDS Certificates
Who files: Partnership Firm / LLP / AOP / BOI / AJP / Estate of Deceased / Business Trust / Investment Fund
| # | Document / Information Required | Details / What to Check | Mandatory? | Source |
|---|---|---|---|---|
| A. ENTITY IDENTIFICATION | ||||
| 1 | PAN of the Entity | Firm / LLP / AOP / BOI PAN | Yes | IT Dept |
| 2 | Name of the Entity | Exact name as per PAN / registration | Yes | PAN / Deed |
| 3 | Date of Formation | As per deed / certificate of incorporation | Yes | Partnership deed / MCA |
| 4 | Nature of Business / Profession Code | IT Dept prescribed codes | Yes | IT Dept list |
| 5 | Registered Office Address | Current address for communication | Yes | Deed / GST registration |
| 6 | Designated Partner / Authorized Signatory PAN | PAN of person signing the return | Yes | PAN card |
| B. PARTNER / MEMBER DETAILS | ||||
| 7 | Names & PAN of all Partners / Members | All partners including sleeping partners | Yes | Partnership deed / LLP deed |
| 8 | Profit Sharing Ratio | As per deed | Yes | Partnership deed |
| 9 | Capital Contribution of each Partner | Opening + Closing balance in capital account | Yes | Books of account |
| 10 | Remuneration / Salary to Partners | Allowable u/s 40(b) — within prescribed limits | If paid | Books / Deed |
| 11 | Interest on Capital to Partners | Allowable u/s 40(b) — max 12% p.a. | If paid | Books / Deed |
| 12 | Drawings by Partners | Amount withdrawn during FY | Yes | Books of account |
| C. BOOKS OF ACCOUNT & FINANCIALS | ||||
| 13 | Profit & Loss Account (FY25-26) | Income, expenses, net profit | Yes | Tally / Books |
| 14 | Balance Sheet as on 31 March 2026 | Assets, liabilities, capital accounts | Yes | Tally / Books |
| 15 | Trading Account (if trading entity) | Opening stock, purchases, sales, closing stock | If trading | Books |
| 16 | Schedules to Financial Statements | Detailed schedules for major items | Yes | Books |
| 17 | Tax Audit Report — Form 3CA / 3CB & 3CD | If turnover >₹1 Cr (business) / ₹50L (profession) | If applicable | CA certificate |
| 18 | GST Returns Reconciliation | Reconcile GSTR-1 / 3B / 9 with books | Yes | GST portal |
| D. INCOME DETAILS | ||||
| 19 | Business / Professional Income | Net profit as per books after allowable deductions | Yes | P&L account |
| 20 | House Property Income | Rental income from properties owned by firm | If applicable | Rent receipts / deed |
| 21 | Capital Gains | Sale of firm assets, investments | If applicable | Sale documents |
| 22 | Other Sources | Interest income, dividends, etc. | If applicable | Bank statements / AIS |
| E. DEPRECIATION & ASSETS | ||||
| 23 | Fixed Asset Register | Block-wise depreciation as per IT Act | Yes | Books of account |
| 24 | WDV of each asset block as on 1 Apr 2025 | Opening WDV | Yes | Last year ITR / Books |
| 25 | New Assets Added — date & cost | Date of addition and put-to-use date | If applicable | Purchase invoice |
| 26 | Assets Sold / Discarded | For Short-term capital gain on depreciable assets | If applicable | Sale documents |
| F. DEDUCTIONS & EXEMPTIONS | ||||
| 27 | Sec 80G — Donations | With Form 10BE | If claiming | Form 10BE + receipt |
| 28 | Sec 80IC / 80IE | If unit in special category state | If applicable | CA certificate |
| 29 | MAT (if AOP assessed like company) | Minimum Alternate Tax computation | If applicable | CA computation |
| G. TAX PAID DETAILS | ||||
| 30 | Form 26AS | TDS / TCS / Advance Tax — entity-level | Yes | TRACES / IT portal |
| 31 | AIS of Entity | Cross verify all income reported | Yes | IT portal |
| 32 | Advance Tax Challans | Paid in the name of firm | If paid | Bank / IT portal |
| 33 | Self Assessment Tax Challan | Balance tax before filing | If applicable | Bank / IT portal |
| 34 | TDS Certificates (Form 16A) | TDS on rent, commission, professional fees, etc. | If applicable | TRACES / Deductor |