July 31, 2017 is the last date for filing income tax returns for FY 2016-17. It’s important to know what has changed in ITR compared to last year. The biggest change is the number of ITR forms have reduced from 9 to 7. Other than that all the tax returns have to filed electronically except for people who are more than 80 years of age and have income less than Rs 5 lakhs and have no claim for refund.
1. Less number of ITR Forms
The numbers of ITR Forms have been reduced from 9 to 7.
The previous ITR 2A, ITR 2 and ITR 3 forms have been rationalized to single ITR 2 Form.The previous ITR 4 Form has been re-numbered as ITR 3.ITR 4S (Sugam) is now ITR 4 (Sugam).
2. One pager form for Salaried Tax payer [ITR 1 Sahaj]
As promised the government has come out with simple, one pager ITR 1 Sahaj form which can be filled by tax payers who have income from salary/pension, one house property and income from other sources like interest income. However to fill this form the total income should be less than Rs 50 Lakhs.
The form has done away with the long list of deductions and only included the most common deductions under section 80C, 80D, 80G and 80TTA. If the tax payer wants to claim tax benefit under other sections he can do so by mentioning relevant section in column titled “Any Other”.
Some new columns have been introduced to report dividend income (u/s Section 10(34)) and exempted long term capital gains (u/s Section 10(38)).
3. Disclose Cash Deposited during Demonetization [ITR 1, 2, 3, 4, 5, 6, 7]
A new field has been inserted in all ITR Forms to report the amount of cash deposited during the demonetization period of November 9 to December 30, 2016. However you need to report this if the cash deposit during the period exceeds Rs 2 Lakhs.
4. New Field for quoting Aadhar Number [ITR 1, 2, 3, 4]
The finance bill was amended to make it compulsory for tax payers to quote their aadhar number while filing income tax return. The ITR Forms have introduced column for either entering aadhar number or the Enrolment ID in case the aadhar is not received but has been applied for.
5. Fields for Income Taxable at special rates [ITR 2, 3, 4, 5, 6, 7]
Some incomes are taxed at special rates. The ITR forms have introduced columns to declare these.
Unexplained Income:
As per Section 115BB, any unexplained income or investment attracts special tax of 60% (plus surcharge and cess, as applicable) irrespective of the tax slab. This can now be shown in the newly inserted column under ‘Schedule OS’ .
6. Deduction under section 80EE [ITR 2, 3, 4]
Section 80EE gives additional tax exemption of Rs 50,000 for payment of interest on housing loan to first time home buyers. This is over and above the tax exemption of Rs 2 lakhs u/s 24(b). A new field has been introduced in Schedule VI-A to claim this deduction.
In case you are filling ITR 1 you can mention Section 80EE in “Any Other” deductions to avail this tax benefit.
7. More detailed declaration of assets/liabilities by Individuals earning above Rs 50 lakhs [ITR 2, 3, 4]
Last year the income tax department had introduced new section to declare the values of assets and liabilities of individuals with income of more than Rs 50 lakhs. This year the ITR form asks for more detailed information like address of immovable property.
*Please get more clarifications from incometax site.
1. Less number of ITR Forms
The numbers of ITR Forms have been reduced from 9 to 7.
The previous ITR 2A, ITR 2 and ITR 3 forms have been rationalized to single ITR 2 Form.The previous ITR 4 Form has been re-numbered as ITR 3.ITR 4S (Sugam) is now ITR 4 (Sugam).
2. One pager form for Salaried Tax payer [ITR 1 Sahaj]
As promised the government has come out with simple, one pager ITR 1 Sahaj form which can be filled by tax payers who have income from salary/pension, one house property and income from other sources like interest income. However to fill this form the total income should be less than Rs 50 Lakhs.
The form has done away with the long list of deductions and only included the most common deductions under section 80C, 80D, 80G and 80TTA. If the tax payer wants to claim tax benefit under other sections he can do so by mentioning relevant section in column titled “Any Other”.
Some new columns have been introduced to report dividend income (u/s Section 10(34)) and exempted long term capital gains (u/s Section 10(38)).
3. Disclose Cash Deposited during Demonetization [ITR 1, 2, 3, 4, 5, 6, 7]
A new field has been inserted in all ITR Forms to report the amount of cash deposited during the demonetization period of November 9 to December 30, 2016. However you need to report this if the cash deposit during the period exceeds Rs 2 Lakhs.
4. New Field for quoting Aadhar Number [ITR 1, 2, 3, 4]
The finance bill was amended to make it compulsory for tax payers to quote their aadhar number while filing income tax return. The ITR Forms have introduced column for either entering aadhar number or the Enrolment ID in case the aadhar is not received but has been applied for.
5. Fields for Income Taxable at special rates [ITR 2, 3, 4, 5, 6, 7]
Some incomes are taxed at special rates. The ITR forms have introduced columns to declare these.
Unexplained Income:
As per Section 115BB, any unexplained income or investment attracts special tax of 60% (plus surcharge and cess, as applicable) irrespective of the tax slab. This can now be shown in the newly inserted column under ‘Schedule OS’ .
6. Deduction under section 80EE [ITR 2, 3, 4]
Section 80EE gives additional tax exemption of Rs 50,000 for payment of interest on housing loan to first time home buyers. This is over and above the tax exemption of Rs 2 lakhs u/s 24(b). A new field has been introduced in Schedule VI-A to claim this deduction.
In case you are filling ITR 1 you can mention Section 80EE in “Any Other” deductions to avail this tax benefit.
7. More detailed declaration of assets/liabilities by Individuals earning above Rs 50 lakhs [ITR 2, 3, 4]
Last year the income tax department had introduced new section to declare the values of assets and liabilities of individuals with income of more than Rs 50 lakhs. This year the ITR form asks for more detailed information like address of immovable property.
*Please get more clarifications from incometax site.
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