These changes you must note in ITR forms - Know how to file new Income Tax Return
ITR has a prescribed set of forms which contains details of income earned by a person in a financial year and taxes paid on such income.
The Income Tax Return (ITR) filing period has commenced for assessment year FY2019-20. ITR is a must procedure that every taxpayer should follow. ITR has a prescribed set of forms which contains details of income earned by a person in a financial year and taxes paid on such income. This income must be communicated to the Income Tax department through ITR filing. Apart from this, ITR also allows carry -forward of loss and claim a refund from the income tax department. Different forms of returns of income are prescribed for filing of returns for different Status and Nature of income. However, there have been many changes made in ITR forms which a taxpayer must note before filing ITR.
The new ITR forms were notified recently. As per the new forms, the taxpayer will have to provide additional details such as days of residency in India, holdings in unlisted shares and details of the buyer(s) of property in case of capital gains earned by a seller on the sale of immovable property.
According to Archit Gupta Founder and CEO of ClearTax, here's a list of changes made in ITR form 1, 2 and 4.
Changes in ITR-1 form!
ITR-1 form is applicable to resident individuals, except for the director of a company or the holders of unlisted equity shares. Total income must not exceed Rs 50 lakh. An additional row has been provided for claiming a standard deduction of Rs 40,000 for FY 2018-19.
The taxpayer is also required to furnish income-wise details, like interest income from savings account, bank deposits, income tax refund, family pension income and others, under ‘Income from other sources’ column of new ITR-1. If there are allowances, exempted from tax partially or fully, then their amount should be mentioned separately in ITR-1.
Changes in ITR-2 form!
Individuals and Hindu Undivided Families (HUFs) who do not have income from profits and gains from business or profession can file their returns with ITR-2 form.
As per the newly notified ITR-2 form, taxpayers will be required to specify their residential status of the FY 2018-19. An individual can be considered as a resident, ordinary resident or non-resident in the financial year for income tax purposes. Detailed information regarding days present in India must be provided to satisfy residential status.
Additionally, in the column for 80G the amount must be segregated into cash and other modes of contribution.
Changes in ITR-4 form!
Taxpayers with a cumulative income of up to Rs 50 lakh and those who are Resident, or Ordinarily resident of India can file ITR-4 form. Directors or those who held unlisted equity shares at any time during the financial year 2018-19 can no longer file returns with ITR-4 form; they have to file ITR 3 form.
The taxpayers having a business of plying, hiring and leasing goods carriages and have opted for presumptive taxation scheme (Section 44AE) will now have to provide details, such as registration no. of goods carriage, whether owned/leased/hired, tonnage capacity of goods carriage (in MT) etc.in new ITR-4.
In addition to these new changes, only taxpayers above the age of 80 years filing ITR-1 or ITR-4 are eligible for paper filing facility. Everyone else must mandatorily file their returns online. Also, taxpayers with income up to Rs 5 lakh and seeking a refund are not allowed to file their ITR in the paper format starting returns for FY 2018-19.
Watch Zee Business TV live streaming video below:
Here's how to file the new ITR forms, as per Gupta.
It is mandatory to file the income tax returns online for all the registered taxpayers, except for those who are above 80 years of age and do not have any income from business or profession.
Taxpayers can begin filing ITR-1 & ITR-4 as applicable. Aadhaar and PAN must be linked for those who are eligible for an Aadhaar. In sometime Form 16 will be made available by employers and taxpayers can begin filing online for FY 2018-19 by simply uploading their Form 16.
Currently, the Income Tax department has opened the window for filing ITR-1 and ITR-4 form. Others will be allowed shortly. Hence, before filing your ITR, you must remember the above-mentioned changes.