Get to know about recent changes in ITR Forms

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recent changes in ITR Forms

For Financial year 2016-17, the income tax department has released many changes for ITR forms. This is done to simplify the tax filing process and free taxpayers from the burden of compliance. The Income Tax Return forms that have been released will be applicable on income earned from 1st April 2016 to 31st March 2017 and the deadline for submitting these forms will be 31st July 2017.

Get to know about recent changes in ITR Forms

However, the Central Board of Direct Taxes (CBDT) has notified new income tax return forms for the Assessment Year 2017-18. Recent changes in ITR forms have made it compulsory for all taxpayers who have an income of more than 5 lacs to file tax returns electronically. At the same time, they cannot claim for a refund. Also, Income tax Returns forms have been reduced from 9 to 7. The recent changes in Income tax return forms that every individual/professional/HUF must know are as follows:

1. Single page Income tax Return form

The government has come out with a single page ITR–1 form in the name of ITR-1 Sahaj. This form can only be filed by taxpayers who have one house property, income derived from salary or pension or income from other sources such as interest income. Only those taxpayers can fill this form whose income is less than 50 lakh rupees. Those taxpayers with an income of more than 50 lakh rupees or those who have more than one house property should file ITR-2 form. People above the age of 80 can file paper returns as well as those who has not claimed any refund in income tax return. Also, the form has discarded many deductions and included those mentioned under section 80C, 80G, 80D and 80TTA. A new column called ‘Any Other’ has been added for tax payers who want to claim other tax benefits.

2. Asset/Liability column removed

Sahaj form does not have any mention of asset and liability. It has been removed from Income tax return1 form. Before changes in Income tax =return were introduced, while filing income tax return, a person with an income of more than 50 lakh a year had to declare asset and liability.  But now, a person with an income over 50 lakh does not have to file ITR-1 form, hence it has been done away with. For all other forms, the asset and liability column has become more detailed and includes information like address of immovable property.

3. Number of Income tax Return forms reduced

As mentioned before, the number of Income tax Return forms have come down from 9 to 7. ITR 2A that was filed by taxpayers with more than one house property, ITR 3 that was filed by those deriving income from profession and business and ITR 2 that was filed by taxpayers who had more than one house property as well as taxable capital gains have been done away with. These (ITR-2, 2A and 3) have been merged into a single ITR 2. Hence, a person with more than one house property, income from business or profession and taxable capital gains will have to file the new ITR 2 form. Additionally, ITR 4 has been rationalized as ITR 3 and ITR 4S (also called Sugam) has been renumbered as ITR 4.

4. Income taxable at special rate

Some new columns have been introduced for incomes that are taxed at special rates. These include income from patent in which royalty received for patent registered and developed in India will be taxed at 10% (as per section 115BBF). A new column called ‘Schedule OS’ can be used to report the same. A taxpayer who has dividend income of more than 10 lakhs from domestic companies can also be reported in column ‘Schedule OS.’ It will be taxable at 10%. (As per section 115BBDA). Taxpayers having an income of more than 10 lakhs can not file ITR-1 form. An unexplained income or investment will be charged with 60% tax, plus surcharge and cess (As per Section 115BB).

5. Tax exemption on housing loan

Additional tax exemption of Rs. 50,000 for payment of interest on house loans can be availed by first time buyers under section 80EE. This is above tax exemption of Rs. 2 lakh that is mentioned under section 24(b). This deduction can be claimed in a new field that has been introduced in Schedule VI-A. For those filing ITR-1, this deduction can be claimed by mentioning Section 80EE in the section ‘Any Other’ of ITR-1.

6. Quoting Aadhar number

Taxpayers will now have to compulsorily quote their Aadhar number while filing tax returns. Aadhar must be quoted in ITR-1, 2, 3 and 4. This column has been added to either enter Aadhar number or enrolment ID in case if Aadhar is not received by has been applied for by the taxpayer.

7. Unclaimed credit

Unclaimed TDS/TCS of present year can now be carried forward to the next year. Taxpayers are required to disclose tax deducted at source or tax collected at source in specific schedules in tax returns. Previously, there was no mechanism to do this but recent changes in Income tax freturn has included this mechanism.

2 COMMENTS

  1. Great work and thanks for notifying the Central Board of Direct Taxes (CBDT)new income tax return forms for the Assessment Year 2017-18. Through this i came to understand about the Recent changes in ITR forms which have made it compulsory for all taxpayers who have an income of more than 5 lacs to file tax returns electronically. And at the same time, they cannot claim for a refund. Also, ITR forms have been reduced from 9 to 7. The recent changes in ITR forms that every individual/professional/HUF must know are explained in detailed through this blog.The work done by ITR team is appreciable and it really nice to explain everything about taxes. It touches each and every corner of tax and its related branches in a neat and aligned manner.

  2. Thanks this blog has really helped me alot. This really helps and tells a process that is required to fill up an Income tax return. This blog tell us step by step how we should fill taxes and yes it is also easy to understand. Each and every details have been mentioned in simple and clear language.
    i would prefer anyone to have a eye on it to clear all their doubts. The best thing about this blog is that we can get every information hear only. we shoud not go on different side to search about itr. Great work keep it up.It tell breifly and accurately about taxes. The blog is very detailed and the way it explains the things is very easy to understand and to retain it really helps a person on how to fill up the ITR and how to enquire about it. Great work from ALL INDIA ITR since it is a very well written and a very useful blog.

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