Income Tax Department Notifies New ITR Forms
Income Tax Department Notifies New ITR Forms – The I-T department notified a total of nine ITRs — Sahaj (ITR-1), ITR-2, ITR-2A, ITR-3, Sugam (ITR-4S), ITR-4, ITR-5, ITR-6, ITR-7.
The IT department notified a new set of 9 ITR forms for assessment year 2016-17. A fm’s gazette order said that taxpayers can file their ITRs by July 31, 2016.
In a move that may aid the income tax department to track tax evasion by high net worth individuals, the tax department has mandated all individuals and HUFs with income over Rs 50 lakh per annum to disclose the details and cost of their immovable and movable assets such as cash, jewellery, vehicles, yachts, boats and aircraft.
“With Assessment Year 2016-17, individuals and HUFs filing their returns of income in ITR-1, ITR-2, ITR-2A and ITR-4S, having income exceeding Rs50 lakh will now be required to furnish information regarding assets and liabilities in Schedule-AL of the relevant ITR form,” said a release issued by the Central Board of Direct Taxes.
While individuals and HUFs with income above a specified limit, filing returns in ITR-3 and ITR-4 were already required to furnish information of their assets and liabilities in their annual return of income, now even individuals and HUFs not having income from business and profession would be required to furnish the details if their income exceeds the specified limit. While a senior government official said, “The additional reporting has been introduced to check tax evasion by HNIs,”. A financial planner said that, “this will help the government map an individual’s income against his assets and liabilities.” He however, added that the value of the assets to be disclosed should ideally be the acquisition cost and not the market cost.
The asset and liability section of the form introduced by the I-T department has been termed as “Asset and Liability at the end of the year” and calls for disclosure of the immovable assets such as land and building and their cost and movable properties such as cash at hand and cost of jewellery, bullion, vehicle, yachts, boats and aircraft. Those reporting these high-value possessions will also have to describe their “liability in relation” to such items.
The CBDT release issued on Friday also said that tax payers are not required to file the wealth tax return. “With the passage of Finance Bill, 2015, wealth-tax is no longer leviable with effect from assessment year 2016-17. Taxpayers are, therefore, not required to file a wealth tax return from assessment year 2016-17 onwards,” the CBDT said.
While the finance minister announced tax exemption for three years for startups in the Budget, the I-T department has introduced a separate column for earnings made from the same. The ITR -2A has a new section called Pass Through Income (PTI) and seeks details from business trust or investment fund as per section 115UA and 115UB of the I-T Act. While it pertains to emerging firms and start us, these sections provide a tax pass through and the income is taxable in the hands of investors instead of VCF / VCC.
The I-T department notified a total of nine ITRs — Sahaj (ITR-1), ITR-2, ITR -2A, ITR-3, Sugam (ITR -4S), ITR-4, ITR-5, ITR-6, ITR-7.
Even the simplest form ITR -1 (Sahaj) for salaried individuals having one house property is now a seven page form instead of five pages earlier and has an additional column to mention tax collected at source.