CSR Applicability FY 2425

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Your private limited company is likely liable for CSR in FY 24-25 as your net profit of ₹7 crore exceeds the ₹5 crore threshold. This calculation includes income from capital gains and one-time keyman insurance, as these are generally considered part of net profit for CSR purposes under Section 135 of the Companies Act, 2013. The CSR expenditure required is 2% of your average net profits over the last three financial years.

TUKARAMKOCHALE

TUKARAMKOCHALE (Querist)
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09 August 2025 My company is PVT LTD company & My NP ( Net Profit ) for the year FY 24-25 is 7 CR including income other then business income.
Out of which other income includes capital gain is 3 CR & Keyman insurance income ( One time income ) is 2 CR.
Shall we applicable for CSR liability?
What are the calculation for the same?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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10 August 2025 Your company is liable for CSR (Corporate Social Responsibility) under Section 135 of the Companies Act, 2013, since your net profit for FY 2024-25 is Rs. 7 crore, which is above the Rs. 5 crore threshold.

CSR provisions apply if, during the preceding financial year, any of the following is true:
Net worth > Rs. 500 crore
Turnover > Rs. 1000 crore
Net profit > Rs. 5 crore.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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10 August 2025 CSR expenditure must be at least 2% of the average net profits of the company made during the three immediately preceding financial years. If your company is young (with less than 3 full years), the average is taken over however many years of net profit are available.
Though part of "other income"—are generally included in the computation for CSR applicability, unless specifically excluded by Section 198. Current guidance and precedents indicate that capital gains and Keyman insurance income (one-time or otherwise) are to be considered part of net profit for CSR purposes.

"Net profit" for CSR is calculated per Section 198 of the Companies Act, not simply as the net profit shown in regular financial statements. It generally:
Includes all profits except profits from overseas branches and dividends from other companies.
Excludes certain sums as prescribed under Section 198.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 September 2025 Good luck....

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