Changes you need to know for I-T returns

Changes you need to know for I-T returns

When you file your income tax (I-T) returns in July, you will have to fill details such as allowances that are not exempt, value of perks, and profits in lieu of salary in the new I-T return forms notified for the assessment year 2018-19.A one-page simplified ITR Form-1 (Sahaj) can be filed by an individual who is a resident having income up to Rs 50 lakh and who is receiving income from salary, one house property and other income (interest, etc), the I-T department said. The detailed break-up of salary was not part of ITR forms last year but has been added this year.

Similar details have to provided for income from house property. Gender mention requirement has been removed from ITR-1. Non-resident individuals cannot use ITR-1 to file returns and will have to use ITR-2 or -3, depending on their nature of income in India. Tax experts said this could raise their compliance costs. The ITR-1 form is similar to the one for the previous assessment year, which had been used by 3 crore taxpayers who filed their returns using this form. You will also have to provide details of all bank accounts held in the country at any time during the previous year, except dormant accounts.

The requirement of furnishing details of cash deposit made during a specified period as provided in the ITR form for the assessment year 2017-18 has been done away. This provision was added in the aftermath of the demonetisation drive.ITR Form-2 has also been rationalised by providing that Individuals and HUFs (Hindu Undivided Families), having income under any head other than business or profession, shall be eligible to file returns under this form.

The Individuals and HUFs, having income under the head business or profession, shall file either ITR Form-3 or ITR Form-4, the departmentsaid. “There are more than 25 key changes in current year ITR forms in comparison to last year. Some of these changes suggest that the focus of new ITR forms is to get more information from unlisted companies, trusts and taxpayers, who have opted for presumptive taxation scheme,” said Naveen Wadhwa, deputy general manager at Taxman.

“Further, the ITR forms also require the business entities to report the GST transaction, which would help the department to independently reconcile the transactions reported by them in income-tax returns and GST returns,” he said. In case of non-residents, the requirement of furnishing details of any one foreign bank account has been provided for credit of refund. “There is no change in the manner of filing of ITR forms as compared to last year. All these ITR forms are to be filed electronically,” the department said.

Any individual who is 80-year-old or more has the option to file paper returns as well as an Individual or HUF whose income does not exceed Rs 5 lakh and who has not claimed any refund in the return of income. Tax experts said additional fields for penalty due to delayed filing have been added in ITR-1 and ITR-2.

“The new Form ITR-1 (Sahaj) for assessment year 2018-19 does not request for the residential status of the individual and it is neither applicable to individuals qualifying as Not Ordinarily resident (NOR) nor to non-residents (NR). So Indian employees who have left India for overseas employment in the first half of the year and qualifying as non-resident would be required to file their India tax returns in ITR-2, even though they have annual taxable income up to Rs 50 lakh,” said Alok Agarwal, senior director at Deloitte.

The Times of Indian, New Delhi, 07th April 2018

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