Author : Mr.Jay Shah – Virtual CFO
With introduction of changes in Finance Act 2017, suitable changes in Income tax return were needed. The changes mainly cover demonetization effects, linking of PAN with Aadhar number for return filing, disclosure of special income and so on….
In the era of digitalization Government is elegantly collecting key information from taxpayer vide Income tax return which should ideally reconcile with transaction captured by Income tax database. In this aspirational journey of tracking suspicious transactions the only word of caution for tax payer is to double check their figures reported in income tax return in order to avoid unnecessary enquiry. The said article covers recent changes in income tax return for AY 2017-18 and classification of returns, reader shall take 10-15 minutes to read the said article.
| EARLIER FORMAT | NEW FORMAT | APPLICABILITY |
| DISCLOSURE OF CASH DEPOSITS DURING DEMONETIZATION | Individuals/HUF/Firms/ AOP/Companies/Trust [ITR 1, 2, 3, 4, 5, 6, 7] | |
| ♦ Not Applicable
| ✔ New Column introduced to report cash deposit between 9th Nov. 2016 to 30th Dec. 2016 with bank details in which cash is deposited
| |
| INCOME TAXABLE AT SPECIAL RATES | Individuals/HUF/Firms/ AOP/Companies/Trust [ITR 2, 3, 4, 5, 6, 7]
| |
| ♦ Not Applicable
| ✔ New Column introduced for reporting
| |
| DEDUCTION UNDER SECTION 80EE | Individuals/HUF [ITR 2, 3, 4] | |
| ♦ Not Applicable
| ✔ Amount on home loan interest for 1st time buyer over and above the limit U/s 24(b) to be reported under Schedule VI-A deductions under Section 80EE.
| |
| DECLARATION OF ASSETS & LIABILITIES EARNING ABOVE RS 50 LAKHS | Individuals/HUF [ITR 2, 3, 4]
| |
| ♦ Mention cost of immovable property, jewellery, bullion, vehicles, shares, bank and cash balance, etc
| ✔ Additional information required is address of immovable property & description of movable assets ✔ Disclosure of partners share in the assets of a firm/AOP as a partner/member with name, address and PAN no. of firm
| |
| DIGITAL RECEIPTS & OTHER RECEIPTS UNDER PRESUMPTIVE TAXATION SCHEME | Individuals/HUF [ITR 4] | |
| ♦ No bifurcation all Receipts to be reported under presumptive taxation (Section 44AD)
| ✔ Separately mention amount of digital receipts. Consequently, to show presumptive income at 6% and 8% ✔ Option availed for presumptive taxation scheme for professionals under Section 44ADA
| |
| DETAILS OF RECEIPTS AS MENTIONED IN FORM 26AS UNDER TDS SCHEDULE | Individuals/HUF [ITR 4] | |
| ♦ ITR-4S applicable for presumptive income
| ✔ ITR 4 now applicable for presumptive income ✔ In “Schedule TDS2” amount of receipts as mentioned in Form 26as is to be reported
| |
| CHANGES RELATED TO ITR 7 | Trusts
Persons including companies required to furnish return under: (1) Section 139(4A); (2) Section 139(4B); (3) Section 139(4C); and (4) Section 139(4D) [ITR 7] | |
| ♦ Not Applicable
| ✔ Trusts are required to report following additional details
| |
| QUOTING OF AADHAR NUMBER | Individuals/HUF [ITR 1, 2, 3, 4]
| |
| ♦ Optional to mentioned Aadhar card number
| ✔ Section 139AA made compulsory to mention Aadhar card number or enrollment ID if applied
✔ Firms/Trusts to mention Aadhar number for Partners/ trustees
| |
| DISALLOWANCE FOR NON-DEDUCTING OR NON-PAYMENT OF EQUALISATION LEVY |
Individuals/HUF/Firms/ AOP/Companies [ITR 3, 5, 6]
| |
| ♦ Not Applicable
| ✔ Any default in deduction or payment of Equalization levy would attract disallowance of Section 40(a)(ib) which has to mention under ‘Part A-OI’ for such disallowance under section 40(a)(ib).
| |
| OTHER CHANGES IN THE ITR- FORMS & NUMBERS | ||
| ♦ ITR-2, ITR-2A and ITR-3
♦ ITR-4
♦ ITR-4S (Sugam)
♦ Mandatory e-filing not required in case income non taxable
| ✔ Merged to NEW ITR-2
✔ NEW ITR-3
✔ NEW ITR-4 (Sugam)
✔ Mandatory to e-file tax returns for those with LTCG of Rs 2.5 lakhs or more, even though their total taxable income may be below Rs 2.5 lakhs | |
Applicability of ITR forms is given hereunder:
| Types of Assesses | ITR 1 (Sahaj) | ITR 2 | ITR 3 | ITR 4 | ITR 5 | ITR 6 | ITR 7 |
| Individual and HUF | ✔ | ✔ | ✔ | ✔ | |||
| Firms / LLP | ✔ | ||||||
| Association of Persons (AOP) | ✔ | ||||||
| Companies | ✔ | ||||||
| Trusts | ✔ |
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S N & Co
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o Audit o Taxopedia o Advisory
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Disclaimer:
The author has expressed his view on the above article and the same should not consider as an advice. We recommend soliciting the advice of the consultant before taking any action. We shall not be held responsible for any action taken by anyone on the basis of this note before consulting us.
