ITR has a prearranged set of IT forms which comprises of income details earned by an individual in a financial year and the amount of taxes paid on specific income. The revised version of ITR forms has made many changes in ITR forms which a taxpayer must cautiously note before filing ITR.
According to the newly notified forms, the taxpayer has to provide some additional information such as holdings in unlisted shares, days of residency in India, and details of the buyers of property. Mostly, if the capital gains earned by a seller on the sale of immovable property.
The period of (ITR) Income Tax Return filing has initiated for FY2019-20 assessment. ITR Form is mandatory for every taxpayer to file new Income Tax Return. The Income of a person must converse to the Income Tax Department via ITR filing.
ITR also allows claiming a refund and carry-forward of loss from the Income Tax Department. However, there are different forms of returns of income prearranged for filing based on Nature of income and Status. According to the Founder and CEO of ClearTax, the 1, 2 and 4 ITR form has changes that Taxpayer needs to note. Key
Changes in ITR-1 form!
- ITR-1 form is only pertinent to resident individuals, apart from the holders of unlisted equity shares or the director of a company.
- The taxpayer has to furnish income-wise details, such interest income from family pension income, savings account, income tax refund, bank deposits, and others, under column ‘Income from other sources’ of new ITR-1.
- Total income of an individual must not surpass Rs 50 lakh. An additional row has been given to claim a standard deduction of Rs 40,000 for Financial Year 2018-19.
- If there are exempted and allowances, from tax fully and partially, then their amount should be separately mentioned in ITR-1.
Key Changes in ITR-2 form!
- As per the newly notified ITR-2 form, taxpayers will be required to state their residential status of the Financial Year 2018-19. An individual can be measured as a resident, non-resident or ordinary resident in the FY for the purpose of income tax. Detailed information of the days present in India must be given to satisfy residential status.
- Hindu Undivided Families (HUFs) and Individuals who do not have income from profits and gains from profession or business can file their tax returns with ITR-2 form.
- Moreover, in the column 80G, the amount should be segregated into cash and other methods of contribution.
Key Changes in ITR-4 form!
- The taxpayers having a business of hiring, plying, and leasing goods carriages and have decided for plausible taxation scheme (Section 44AE) will now have to provide details like registration no. of goods carriage, whether hired/owned/ tonnage capacity/leased of goods carriage (in MT) etc.in new ITR-4.
- Taxpayers with an accumulative income of up to Rs 50 lakh and those who are ordinarily resident, or resident of India can file Income Tax Return-4 form.
- Directors or those who detained unlisted equity shares during the FY 2018-19 can no longer file ITR-4 form returns; they have to file ITR 3 form.
- Moreover, for paper filing facility to these new changes, only taxpayers above the age of 80 years filing ITR-1 or ITR-4 are eligible. Rest everyone must mandatorily file their tax returns online.
- Also, taxpayers with up to Rs 5 lakh income and pursuing a refund are not allowed to file their Income Tax Return in the paper format starting returns for Financial Year 2018-19.