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Government introduces 3-page ITR, extends filing date till August 31

The fact that the returns form proposed earlier was a 14-page one had been intimidating for most taxpayers.

By: ENS Economic Bureau | New Delhi | Updated: June 1, 2015 2:06:01 pm
income tax return, income tax return form, income tax form, Taxpayers money, income tax return, ITR, e-filing, e-filing tac return, Income tax, business news, indian express The two-page form, introduced in 2009, has undergone several changes and remains far from being simple.

The finance ministry on Sunday revised the tax return forms for different classes of tax payers, dropping the prying questions on foreign travel details and balances in bank accounts that were asked in the forms proposed last month.

According to a ministry statement, the “simplified forms” would bring relief not just to Indian citizens, but also expatriates, who have been spared the obligation of reporting overseas assets acquired before their stint in India, provided these do not yield any income in the year concerned.

This is significant because expatriates who have lived long enough in India and qualify as ‘residents and ordinarily residents’ would have been subjected to prosecution under the recently introduced black money law for non-reporting of overseas assets in their tax returns if the earlier proposals were implemented. India introduced foreign asset reporting requirement from the financial year 2011-12.

To the great relief of those who have income from more than one house property but do not have income from business or profession or capital gain, the department will introduce a new form called ITR2A which does not have detailed sets of questions on capital gains. Besides, the forms for both ITR2 and ITR2A would now contain only three pages and other information would be sought only in schedules which are to be filled only if applicable.

The fact that the returns form proposed earlier was a 14-page one had been intimidating for most taxpayers.

Details of foreign travel such as the countries visited, the number of times visited and the amount spent abroad from own resources in the cases of residents, are dropped from ITR2. The finance ministry statement said that only passport number, if available, would be required in ITR-2 and ITR-2A.

Tax payers have time till August 31 to file returns as per the revised forms. The e-filing software would be ready in the tax department’s website by June 3.

That the ministry has proactively come up with clarifications and extended the deadline for filing returns is reassuring for taxpayers, said Amarpal Chadha, Tax Partner, EY.

The Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015–the Black Money law—provides for three to seven years rigorous imprisonment for wilful attempt to evade taxes and six months to seven years rigorous imprisonment for failure to file return of foreign assets and bank accounts.

Sources in the government, however, said that the tax authority is likely to obtain the same information from other sources to check tax evasion. The attempt is to make tax return forms less intrusive and simultaneously to tap third party sources, which would yield information of not just tax return filers, but also of people who do not file and are likely to be the real tax evaders. FE

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