The Income Tax authorities of India have notified the new tax return forms for the financial year 2017-18. Individuals, who need to file a return of the income, must do it within July 31 this year, unless otherwise it is extended by any notification. Interestingly, different tax return forms are applicable to different types of tax assesses. Otherwise, individuals may end up submitting a defective return. In this regard, there are various types of parameters like type of income, residential status and others are pivotal in selecting a specific ITR form. There are four types of ITR forms namely ITR 1, ITR 2, ITR 3, ITR 4. In the following blog, changes in the forms will be discussed along with common changes which are applicable to all the forms.
Previously ITR form 1 was applicable for both residents, Residents Not ordinarily resident (RNOR) and also Non-residents. Currently, the all new Sahaj ITR form 1 2017-18 has been made applicable only for resident individuals. Importantly, from now on, individuals will need to furnish a break up of salary. Previously that was only needed in case of submitting Form 16. Side by side, furnishing a break up of income under house property is also made mandatory which was previously needed for ITR 2 and other forms. Let’s not forget that under the schedule on TDS, there is also an additional field for furnishing details of TDS as per Form 26QC for TDS made on rent. Meanwhile, there is a specific provision for quoting PAN of a tenant as well in case of rent cases.
In the changing circumstances, ITR 2 has been made more clear where HUF having income other than income need to mention under the head ‘profits and gains from business or profession’. Side by side, Schedule-IF (Income from Firm) and Schedule-BP have been removed and anyone earning income from a partnership firm has to file ITR-3 and not ITR -2 forms. Similar to ITR form 1, in ITR 2, under the Schedule on TDS, there is also an additional field for furnishing details of TDS as per Form 26QC for TDS made on rent and provision for quoting of PAN of a tenant for such rent cases has been added. ITR 2 doesn’t have any field of ‘profits and gains from business or profession’. Not only has that, under Schedule AL, the field pertaining to “Interest held in the assets of a firm or association of persons (AOP) as a partner or member thereof” has been discontinued.
ITR 3 has been specifically prescribed for individuals and HUF having ‘Taxable Income from Profits and Gains from Business or Profession’. Side by side, a specific field has been added relating to Section 115H. Again, fields under Schedule PL have been modified to include GST related details for individuals. Meanwhile, depreciation has been limited to a maximum of 40% in all depreciation related schedules. In case of ITR 4, from now on, there is an additional requirement to quote GSTR No. and turnover/gross receipts as per GST return filed.
Separate fields have been added under financial particulars where an assessee has to declare partners/ members’ capital, secured loan, unsecured loan, advances and fixed assets.