Taxation

CBDT Notifies Income-tax Return Forms For FY 2018-19 

By CA. Gaurav Gandhi    -   April 12, 2019

Central Board of Direct Taxes (CBDT) has amended the income-tax rules via notification dated 1 April 2019 for introduction of new income-tax return forms (ITR forms) applicable for the financial year (FY) 2018-19 (assessment year 2019-20). However, detailed instructions and utilities (other than ITR 1 and ITR 4) to fill the form are yet to notified. 

Currently ITR 1 and ITR 4 are available for filing purposes. Though, there are not much changes in ITR 1 and ITR 4 except from certain exclusions being added for eligibility for these forms. 

ITR -1 (Sahaj) can be filed by Resident and Ordinarily Resident (ROR) taxpayers whose total income does not exceed Rs. 50 lakhs.Similar condition is applicable for ITR 4 as well in case of individuals.

Other changes which have been brought are as follows: 

  • For enhanced transparency, individual taxpayers are required to report their residential status based on the applicable clause of section 6 i.e. rule of residency (based on the individual's physical presence in India) in comparison to only Resident and/not ordinarily resident (ROR/RNOR) selected earlier.
  • Non-resident (NR) individuals are not only required to select NR, but also required to report their country of residence and Taxpayer identification number in that jurisduction. Further, in case a non-resident individual is Citizen of India/ Person of Indian Origin (PIO), they are required to report their actual number of days in the FY 2018-19 and in the last four FYs. 
  • Certain additional exceptions to individuals who are now ineligible to file ITR 1 (Sahaj): 
  • ROR individuals claiming expense deduction under the head “income from other sources” (except for family pension) or holding unlisted shares in India or a director in a company or is assessable for the income on which TDS has been withheld in the hands of a person other than the assesse;
  • The option of paper filing of ITR1 and ITR4 is now available only for ROR super senior citizens (age 80 years or more). 
  • Similar restrictions as mentioned above are applicable to individuals for filing ITR 4 (Sugam). Further, HUF/Firms which are resident in India are eligible to file ITR 4 (this condition was already mentioned in section 44AD). 
  • Disclosures in relation to unlisted shares with details of opening balance, acquired/ transferred during the year and the closing balance. 
  • Details of whether an individual is a director in a Company along with PAN of Company and DIN details for better transparency. Similarly, information is required for interest in partnership firms.
  • Additional details like rate in treaty, section of income tax act etc. are necessary to be filled where benefits of Double Taxation Avoidance Agreement (tax treaty)  are claimed by the taxpayers including confirmation of tax residency certificate. 
  • Foreign assets and income schedule (Schedule FA) requires expanded disclosures, i.e., details of foreign depository accounts, foreign custodian account, holding of foreign equity and debt, foreign cash value insurance/ annuity held, either as an owner or beneficiary. 
  • Under the “exempt income schedule” Agricultural income exceeding Rs. 5 lakhs are to be reported along with details such as the district name with pin code, measurement of agricultural land, whether owned/ leased, whether irrigated or rain fed.

With the changes being brought in the taxation laws, it is evident that tax authorities are being more cautious for dubious transactions and shell companies. Additional details being will not only prevent unnecessary or wrong claims but also help in reducing assessment where unnecessary questions were raised which were only clarificatory in nature.

Hope you find the above summarised changes useful.

Regards,

TheTaxTellers Team

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