To initiate new financial year with a specified amendment in tax filing policy, CBDT (Central Board of Direct Taxes) has recently announced for a new tax filing pattern for assessment year 2018-19. CBDT stating acceptance of good number of new taxpayers in 2017-18 subjected the need for bringing in the New ITR forms for the coming assessment year 2018-19. CBDT told  that these forms will simplify ways for a taxpayer and will present a complete breakup of his salary income and GST details of business , which will give work for direct reporting of deductions availed and all the business turnovers furnished till date to government.

While no major changes have been done to the 7  ITR forms, they all have been added with additional requirement of details of taxpayers of their income sources . In a statement released by CBDT,  it was stated that all New ITR Forms are to be considered and are to be mandatorily filed by every taxpayer electronically other than giving exception to few taxpayers.

New ITR Form 1 (Sahaj) Specifications  

The new simplified ITR form -1 (Sahaj) is slightly  a modified version of previous year ITR form. It will specify all details about salary heads of an assessee in separate fields including details of allowances, exemptions allowed and claimed, perquisites, profits in lieu of salary and deductions claimed under section 16. These details were earlier specified in form 16 of salaried employees. In the statement , CBDT also said that Sahaj form will make the tax way simpler for salaried people and would be used by over 30 million taxpayers.

Filing of Sahaj e-form :

• Sahaj form has been mandated to be filed by individuals whose income from below sources limits upto Rs 50 lakh as including :

– Income from House property (not including cases of previous losses bought forward)

– Income from Salary /Pension

– Income from other source like lottery,interest or lucky draws

– In cases of clubbed income of spouse or a minor with the taxpayer , if the income limits to above threshold.

• Applicability of filing of ITR-1 has been bought down to only resident individuals which was earlier required for individuals specified in residents, non residents and residents not ordinarily residents criteria.

Structural filing of Sahaj

Section A – General information

Section B – Gross income earned

Section C– Taxable income after deductions and exemptions

Section D–  Calculation of tax payable

Section E – Details of salary income,  advance tax, previous tax payments, TDS/TCS deductions

New ITR Form 2 Specifications

• Individuals and HUFs receiving income from business or profession heads shall file this e-form. While for presumptive income cases both individuals and HUFs have to file either ITR 3 or ITR4.
• Inclusion of income form head Profit and Gains from Business and Profession under Part B of ITR 2 has now been removed from this form.
• It has been proposed to remove income sources of partnership firm from ITR 2, following removal of Schedule IF (income from firms ) and Schedule BP.

New ITR Form 3 Specifications

• Individuals and HUFs having income sources under Income from Profits And Gains Form Business And Profession head have been prescribed to file ITR 3 e-form.
• Schedule PL – specifying GST details of business have been included in this form.
• A maximum rate of 40% Depreciation has been specified to be claimed in all cases as per added schedules.

New ITR Form 4 (Sugam) Specifications

• Individuals/HUFs/Partnership firm filing income tax return referring to section 44AD and 44AE specifying business and profession are required to file ITR Form 4 (Sugam).
• While no major changes has been done in filing of ITR 1 and ITR 4 , CBDT has specified allowance for filing of ITR in paper form for :
  • Individual of age 80 or more at any time during previous year.
  • Individual or HUF whose income does not exceed 5 Lakh rupees and  has not claimed any previous refund in their ITR.
• Including several new heads in financial particulars it has been now mandated for every taxpayer to specify all required  additional information in  heads of – ‘Secured loans’, ‘Unsecured loans, Advances’,’ Partners/Member Capital’ and ‘Fixed Assets’.

CBDT made the following changes just at the beginning of the new financial year to help taxpayers simplify their computations and begin with tax filing process. Other than making  minor changes in above New ITR forms, CBDT also eased requirement of furnishing of details of cash deposits made in the year ,which was as required in AY 2017-18 but not to be taken in  AY 2018-19.

While the due date for filing for the coming return session is four months from now, it is better to get all your tax dues cleared at earliest, else you might get penalise under section 234F which might lend you in various penalty issues.

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