Complete ITR Filing Guide for Private Limited Companies & Startups for AY 2026-27

For Assessment Year 2026-27, every private limited company in India files its return in Form ITR-6 , and this year that filing sits on a fault line. The return covers income earned during FY 2025-26, but it is being prepared and submitted in a period when a brand-new income tax law is already in force for current-year operations. Getting the two timelines straight is the first thing a company and especially an early-stage startup needs to settle before touching the form.

This guide walks through which law actually governs the AY 2026-27 return, the corporate tax rates and due dates that apply, advance tax, director remuneration structuring, and the specific levers available to DPIIT-recognised startups.

Which Act applies: clearing the biggest confusion first

The headline question this year is whether company returns are filed under the old Income-tax Act, 1961 or the new Income Tax Act, 2025. The answer is unambiguous, and it is worth stating plainly because a great deal of misinformation is circulating.

Income earned during FY 2025-26 is governed by the Income-tax Act, 1961 and assessed in AY 2026-27. This is confirmed by the Income Tax Department's own transition FAQs. The Income Tax Act, 2025 comes into force on 1 April 2026 and governs only income earned from that date that is, the new "Tax Year 2026-27", which will be filed in 2027. So the return a company files in 2026 for FY 2025-26 is an old-Act return, even though it is submitted after the new Act has commenced.

The practical implication for a company is that it is straddling two regimes at once. The AY 2026-27 return follows the 1961 Act its sections, forms (Form 3CA/3CD for audit), and deduction numbering. But from 1 April 2026, the company's current-year compliance TDS deductions, advance tax for the new year, payroll certificates — already runs under the 2025 Act, with its "Tax Year" terminology and renumbered provisions. Section 536 of the new Act expressly preserves all rights, proceedings and obligations relating to periods before 1 April 2026 under the old law. In short: file AY 2026-27 under the old Act, but run April-2026-onwards operations under the new one.

ITR-6, applicability and due dates

ITR-6 is mandatory for every company other than one claiming exemption under Section 11 (charitable or religious trusts). It must be filed electronically and authenticated with a digital signature; there is no paper or EVC alternative for companies.

Because every company is subject to a statutory audit under the Companies Act and, in most cases, tax audit under Section 44AB, the relevant due dates for AY 2026-27 are:

• 31 October 2026 - filing of ITR-6 for companies liable to audit.
• 30 November 2026 - filing for companies that have entered into international or specified domestic transactions and must furnish Form 3CEB (transfer pricing).
• 30 September 2026 - furnishing of the tax audit report (one month before the ITR due date).
• 31 December 2026 - the last date for a belated or revised return under Sections 139(4)/139(5).

One point startups routinely get wrong: the right to carry forward business losses is preserved only if the return is filed by the original due date under Section 139(1). A late return forfeits carry-forward of business loss — a costly error for a loss-making startup planning to set off those losses against future profits.

Corporate tax rates for AY 2026-27

A domestic company must first decide which rate framework it falls under, because the choice drives both the rate and the availability of deductions.

• Normal rates: 25% where the company's total turnover or gross receipts in FY 2023-24 did not exceed ₹400 crore; otherwise 30%. A surcharge of 7% applies where total income exceeds ₹1 crore (12% above ₹10 crore), plus a 4% health and education cess.
• Section 115BAA (the concessional regime): a flat 22%, which works out to an effective 25.17% after the 10% surcharge and 4% cess. The trade-off is that the company forgoes most specified deductions and incentives. The option, once exercised, cannot be withdrawn, and companies under it are not subject to MAT.
• Section 115BAB (new manufacturing): the 15% concessional rate remains on the statute for companies that already opted in, but the window required manufacturing to commence by 31 March 2024, so it is effectively closed to fresh entrants.
• Minimum Alternate Tax (Section 115JB): 15% of book profit (plus surcharge and cess) continues to apply to companies that have not opted for 115BAA/115BAB. MAT credit can be carried forward and set off for up to 15 years.

A startup claiming the 80-IAC tax holiday (discussed below) should note that MAT still bites during the holiday years, so a nil regular-tax position does not mean a nil tax outflow.

Advance tax: the liability companies underestimate

A company with a tax liability of ₹10,000 or more must pay advance tax in four instalments during the financial year: 15% by 15 June, 45% by 15 September, 75% by 15 December, and 100% by 15 March. For the AY 2026-27 return these dates have already passed, so the relevance now is twofold — computing the interest consequences correctly in the return, and not repeating the mistake for the current year.

Two interest provisions catch companies out. Section 234C charges interest for shortfall in any individual instalment, and Section 234B charges interest where less than 90% of the assessed tax was paid by year-end — both at 1% per month. Companies under MAT are not exempt: advance tax obligations apply to MAT liability as well. A common planning failure is treating advance tax as an annual lump sum rather than a quarterly discipline, which converts an avoidable cash-flow item into an interest cost.

Structuring director remuneration efficiently

For a closely held company, how the founders and directors draw money out of the business is one of the most consequential decisions in the return and one where tax and documentation must align.

Salary versus dividend. Director salary is a deductible business expense for the company and is taxed as salary in the director's hands, with TDS under Section 192. Dividend, by contrast, is paid out of post-tax profits it is not deductible for the company and is then taxed again in the shareholder's hands, with TDS under Section 194 above the prescribed threshold (raised to ₹10,000 from FY 2025-26). That double layer generally makes a reasonable salary more tax-efficient than dividend for owner-directors, though the optimal mix depends on the company's rate framework and the individual's slab.

The reasonableness test. Remuneration paid to directors is a related-party payment, and Section 40A(2)(b) empowers the assessing officer to disallow any portion considered excessive or unreasonable having regard to the fair market value of the services. The defence is contemporaneous documentation — a board resolution authorising the remuneration, alignment with the role and the company's turnover, and consistency year on year. For a non-executive or professional director paid fees rather than salary, TDS may instead fall under Section 194J at 10%.

The founder's angle. Founders often under-draw to conserve cash, but a modest, well-documented salary serves a dual purpose: it gives the company a deduction and builds the founder's own income record, which matters for loans and visas. Where cash is genuinely tight, ESOPs are the structured alternative to cash compensation — and, for eligible startups, carry a valuable deferral benefit covered below.

Levers specific to DPIIT-recognised startups

Startups have a distinct toolkit, and several of these provisions were enhanced recently:

• Section 80-IAC tax holiday: a 100% deduction of profits for any three consecutive years within the first ten years from incorporation. Eligibility requires a Private Limited Company or LLP, DPIIT recognition, an Inter-Ministerial Board certificate, turnover not exceeding ₹100 crore, and incorporation between 1 April 2016 and 31 March 2030 — the window extended by the Finance Act, 2025. Note that 80-IAC cannot run in parallel with 115BAA/115BAB; the company must elect.
• Angel tax abolished: Section 56(2)(viib) has been removed from 1 April 2025, for both domestic and foreign investors. For AY 2026-27, fund-raises at a premium no longer carry that exposure — a significant relief for venture-funded companies.
• ESOP TDS deferral: for employees of eligible startups, the tax on the ESOP perquisite can be deferred to the earliest of 48 months from the end of the relevant year, the employee leaving, or the sale of shares — easing the cash-flow strain of taxing a notional perquisite.
• Loss carry-forward despite funding rounds: the Section 79 relaxation lets an eligible startup carry forward losses even after a change in shareholding, provided every shareholder of the loss year continues to hold shares — protecting accumulated losses through dilutive funding rounds.

Before you file: reconciliation and common mistakes

Most company-return defects are reconciliation failures, not computational ones:

• Match TDS credits in the return against Form 26AS and the AIS/TIS — claim only what is reflected, and chase deductors for mismatches early.
• Reconcile turnover declared in the ITR against the GST returns (GSTR-3B/9). A gap here is among the most common triggers for a departmental notice.
• Compute book profit for MAT carefully where 115JB applies, and carry the MAT credit forward correctly.
• Watch Section 43B(h)sums payable to micro and small enterprises that remain unpaid beyond the statutory time limit are disallowed unless paid within the permitted period; this catches many companies in their first year of applying the provision.
• Ensure related-party transactions and director remuneration are properly captured in the tax audit report (Form 3CD) and supported by resolutions.

Conclusion

For AY 2026-27, the discipline for a private limited company comes down to filing the right form under the right Act, choosing the rate framework deliberately, treating advance tax as a quarterly obligation, and structuring director pay so it survives scrutiny. For startups, the additional reward is real — an extended 80-IAC holiday, no angel tax, ESOP relief and protected losses but each carries eligibility conditions that must be met and documented. The companies that file cleanly are invariably the ones that reconcile before they file, not after the notice arrives.

The author is the founder of Patron Accounting LLP, a multi-disciplinary CA & CS firm headquartered in Pune with offices in Mumbai, Delhi and Gurugram, advising 25,000+ businesses and startups on income tax, ITR-6 filing, GST, audit and ROC/MCA compliance. The firm regularly assists companies with corporate ITR computation, advance tax planning and startup tax incentives.