Notifying the income tax returns for assessment year (AY) 2020-21, the Income Tax Department has made it mandatory for assessees to file I-T returns for high value transactions such as deposits in current account worth over Rs 1 crore, electricity bill payment of Rs 1 lakh or more and spending on foreign travel of Rs 2 lakh and above, even if their income is below the taxable limit.
The Central Board of Direct Taxes (CBDT) on May 30 notified Sahaj (ITR-1), Form ITR-2, Form ITR-3, Form Sugam (ITR-4), Form ITR-5, Form ITR-6, Form ITR-7 and Form ITR-V for the assessment year 2020-21 (income earned between April 1, 2019 to March 31, 2020). The new ITR forms also require taxpayers to furnish details of tax saving investments/donations made during June 2020 for the 2019-20 separately.
Nangia Andersen consulting director Shailesh Kumar said the benefit of simpler forms ITR-1, ITR-2 and ITR-4 would not be available to individuals who are either directors in a company or have invested in unlisted equity shares. “The ITR forms are modified in line with new disclosure requirements made in the Income-tax Act for AY 2020-21. Taxpayers would need to be careful of these new disclosure requirements, before filing their ITR and to select an appropriate ITR form,” he said.
The Centre had earlier withdrawn two I-T returns (ITR-1 and ITR-4), which were notified in January, to allow for the changes due to COVID-19. It extended various timelines under the Income-tax Act, 1961, through the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, extending the time for making investment or payments for claiming deduction under Chapter-VIA-B of the I-T Act that include Section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim) and 80G (Donations) for the financial year 2019-20 to June 30, 2020.
The I-T Department usually notifies the ITR forms in the first week of April of the relevant assessment year.
This year, though, the Department notified forms 1 and 2 in January. But after the COVID-19 pandemic, the Department revised the forms and has now notified all ITR forms in the last week of May.
Returns in ITR-1 Sahaj can be filed by an ordinarily resident individual whose total income does not exceed Rs 50 lakh, while Form ITR-4 Sugam is meant for resident individuals, HUFs and firms (other than LLP) having a total income of up to Rs 50 lakh and having presumptive income from business and profession.
While ITR-3 and 6 are filed by businesses, ITR-2 is filed by people having income from residential property; ITR-5 is filed by LLP and Association of Persons (AoP). ITR-7 is filed by persons in receipt of income derived from property held under trust or other legal obligation wholly for charitable or religious purposes or in part only for such purposes.
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