Significant changes in Income tax returns for AY 2017-18

By | April 26, 2017
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(Last Updated On: May 3, 2017)

Significant changes in Income tax returns for AY 2017-18

 

Extract from above Document

With introduction of changes in Finance Act 2017, suitable changes in Income tax return were needed. The changes mainly cover demonetization effects, linking of PAN with Aadhar number for return filing, disclosure of special income and so on….

In the era of digitalization Government is elegantly collecting key information from taxpayer vide Income tax return which should ideally reconcile with transaction captured by Income tax database. In this aspirational journey of tracking suspicious transactions the only word of caution for tax payer is to double check their figures reported in income tax return in order to avoid unnecessary enquiry. The said article covers recent changes in income tax return for AY 2017-18 and classification of returns, reader shall take 10-15 minutes to read the said article

               EARLIER FORMAT NEW FORMAT APPLICABILITY
                                       DISCLOSURE OF CASH DEPOSITS DURING DEMONETIZATION 

Individuals/HUF/Firms/

AOP/Companies/Trust

 

[ITR 1, 2, 3, 4, 5, 6, 7]

 

Ø  Not Applicable

 

ü  New Column introduced to report cash deposit between 9th Nov. 2016 to 30th Dec. 2016 with bank details in which cash is deposited

 

INCOME TAXABLE AT SPECIAL RATES 

Individuals/HUF/Firms/

AOP/Companies/Trust

 

 

[ITR 2, 3, 4, 5, 6, 7]

 

 

Ø  Not Applicable

 

ü  New Column introduced for reporting

 

o   Unexplained income post demo U/s 115BBE in “Schedule SI”

o   Dividend above 10 lakhs U/s 115BBDA in “Schedule OS”

o   Patent income U/s 115BBF

 

                                                                 DEDUCTION UNDER SECTION 80EE                                                                                                               

Individuals/HUF

 

[ITR 2, 3, 4]

 

Ø  Not Applicable

 

 

ü  Amount on home loan interest for 1st time buyer over and above the limit U/s 24(b) to be reported under Schedule VI-A deductions under Section 80EE.

 

DECLARATION OF ASSETS & LIABILITIES EARNING ABOVE RS 50 LAKHS 

 

Individuals/HUF

 

 

[ITR 2, 3, 4]

 

Ø  Mention cost of immovable property, jewellery, bullion, vehicles, shares, bank and cash balance, etc

 

ü  Additional information required is address of immovable property & description of movable assets

 

ü  Disclosure of partners share in the assets of a firm/AOP as a partner/member with name, address and PAN no. of firm

 

 

DIGITAL RECEIPTS &OTHER RECEIPTS UNDER PRESUMPTIVE TAXATION SCHEME

 

Individuals/HUF

 

 

[ITR 4]

 

Ø  No bifurcation all Receipts to be reported under presumptive taxation (Section 44AD)

 

 

ü  Separately mention amount of digital receipts.Consequently, to show presumptive income at 6% and 8%

 

ü  Option availed for presumptive taxation scheme for professionals under Section 44ADA

 

DETAILS OF RECEIPTS AS MENTIONED IN FORM 26AS UNDER TDS SCHEDULE 

Individuals/HUF

 

 

[ITR 4]

 

Ø  ITR-4Sapplicable for presumptive income

 

 

ü  ITR 4 now applicable for presumptive income

 

ü  In “Schedule TDS2” amount of receipts as mentioned in Form 26as is to be reported

 

 

CHANGES RELATED TO ITR 7 

Trusts

 

Persons including companies required to furnish return under:

(1) Section 139(4A);

(2) Section 139(4B);

(3) Section 139(4C); and

(4) Section 139(4D)

 

[ITR 7]

 

Ø  Not Applicable

 

 

ü  Trusts are required to report following additional details

 

o   Registration number and date of registration for business trusts registered with the SEBI

 

o   Report aggregate of income referred to in section 11 and 12 excluding voluntary contribution

 

o   Report amount applied to charitable or religious purposes (Revenue account).

 

o   Report amount applied to charitable or religious purposes (Capital account).

 

o   Report accreted income of trust under section 115TD

 

QUOTING OF AADHAR NUMBER 

Individuals/HUF

 

[ITR 1, 2, 3, 4]

 

Ø  Optional to mentioned Aadhar card number

 

ü  Section 139AA made compulsory to mention Aadhar card number or enrollment ID if applied

 

ü  Firms/Trusts to mention Aadhar number for Partners/ trustees

 

DISALLOWANCE FOR NON-DEDUCTING OR NON-PAYMENT OF EQUALISATION LEVY 

 

Individuals/HUF/Firms/

AOP/Companies

 

 

[ITR 3, 5, 6]

 

 

Ø  Not Applicable

 

ü  Any default in deduction or payment of Equalization levy would attract disallowance of Section 40(a)(ib) which has to mention under ‘Part A-OI’ for such disallowance under section 40(a)(ib).

 

 

OTHER CHANGES IN THE ITR- FORMS & NUMBERS 
 

Ø  ITR-2, ITR-2A and ITR-3

 

Ø  ITR-4

 

Ø  ITR-4S(Sugam)

 

Ø  Mandatory e-filing not required in case income non taxable

 

 

ü  Merged to NEW ITR-2

 

ü  NEW ITR-3

 

ü  NEW ITR-4(Sugam)

 

ü  Mandatory to e-file tax returns for those with LTCG of Rs 2.5 lakhs or more, even though their total taxable income may be below Rs 2.5 lakhs

 

Applicability of ITR forms is given hereunder:

 

Types of AssessesITR 1 (Sahaj)ITR 2ITR 3ITR 4ITR 5ITR 6ITR 7
Individual and HUFYesyesyesyes
Firms / LLPyes
Association of Persons (AOP)yes
Companiesyes
Trustsyes

Author : Mr.Jay Shah – Virtual CFO

 

Disclaimer:

The author has expressed his view on the above article and the same should not consideras an advice. We recommend soliciting the advice of the consultant before taking any action. We shall not be held responsible for any action taken by anyone on the basis of this note before consulting us.

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