The income tax department earlier used to notify ITR forms for the relevant financial year either by March or April
The Central Board of Direct Taxes (CBDT) has notified ITR forms 1-6, as well as ITR-V (verification form) and ITR acknowledgement form in advance. It will give taxpayers enough time to prepare for relevant disclosures and reporting requirements. The income tax department earlier used to notify ITR forms for the relevant financial year either by March or April.
There are no substantial changes in the six income tax return forms catering to individuals, professionals and businesses, notified by the Central Board of Direct Taxes (CBDT). Here are the key things to know about the latest notification:
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* No significant changes have been made to tax return forms notified this year
* A separate ‘Schedule– VDA’ has been added to report income from virtual digital asset (VDA) such as crypto currency.
* The separate schedule for VDA requires details like date of acquisition, date of transfer head under which income to be taxed (Capital Gain), cost of acquisition (In case of gift; a. Enter the amount etc to be filled in by a person who is in receipt of amounts) for transfer of VDA.
* Individuals on whom search and seizure operations have been carried out by tax officials can now file revised return under Section 153C on the basis of self-assessment of their undisclosed wealth in ITR-1.
* CBDT has also made certain changes in ITR-1 form with regard to disclosure under Section 139 (1), which is filed voluntarily by persons having annual taxable income of less than Rs 2.5 lakh. These individuals will not be required to intimate in their ITR forms even if their fixed deposits exceeds Rs 1 crore.
* Other minor tweaks are in general info section and TCS section.
* In November 2022, the CBDT had circulated the draft version of the ‘Common ITR form’ where all ITR forms from ITR 1 to ITR 6 were proposed to be merged, to bring ease of filing for the taxpayers and reducing the time taken by them to file tax returns.
Read More: Income-Tax department notifies ITR forms 1-6, ITR-V and ITR acknowledgment form for 2022-23
The tax payers filing ITRs 1 to ITR 4 were to have an option to file individual tax forms or the common ITR form as per their choice. This form is not yet released by the CBDT and one needs to wait and see if the CBDT would issue this common ITR subsequently.
In November 2022, in order to simplify the filing of ITR, the CBDT issued a draft proposal to introduce a common income tax return (ITR) form to replace ITR 1-6. The proposed draft ITR takes a relook at the return filing system in tandem with international best practices and proposes to introduce a common ITR.
ITR-1 can be filed by an individual having income up to Rs 50 lakh and who receives income from salary, one house property and other sources (interest, etc). ITR-4 can be filed by individuals, Hindu Undivided Families (HUFs) and firms with total income up to Rs 50 lakh and having income from business and profession.
While ITR-2 is filed by people having income from residential property and having income above Rs 50 lakh, ITR-3 is filed by professionals. ITR-5 and ITR-6 are filed by LLPs and businesses. ITR-7 is for taxpayers including companies that are a charitable or religious trust, political party, research association, news agency or similar organizations specified in the Act.
