09/06/2020
Change with respect to mandatory filing of income tax returns:
The government has notified income tax return forms for 2019-20 and made it mandatory for entities to file ITR if deposits in a current account exceed Rs 1 crore or electricity bill in the fiscal is over Rs 1 lakh or spent above Rs 2 lakh on foreign travels.
The new ITR forms require entities to furnish details of specified high spend transactions, such as deposit of Rs 1 crore or more in a current account, expenditure of Rs 2 lakh or more on foreign travel or spending of Rs 1 lakh or more on consumption of electricity. Also, joint owners of a house property can file ITR-1 Sahaj.
The CBDT has introduced new column in ITR-1, 2, 3 and 4 wherein it has asked three specific questions to the assessee -- have you deposited amount or aggregate of amounts exceeding Rs 1 crore in one or more current account during the previous year? Have you incurred expenditure of an amount or aggregate of amount exceeding Rs 2 lakh for travel to a foreign country for yourself or for any other person? Have you incurred expenditure of amount or aggregate of amount exceeding Rs. 1 lakh on consumption of electricity during the previous year?
Hence, any entity, that is otherwise not required to file ITR, will have to file it for the financial year 2019-20 if the answer to any the above questions is ''Yes''.
The CBDT, which is the apex policy-making body on direct taxes, has also revised the I-T return forms to allow assessees to avail benefits of various timeline extension granted by the government following the COVID-19 pandemic.
Accordingly, the new ITR forms have introduced Schedule DI which requires taxpayers to furnish details of tax-saving investments or donations made between April 1, 2020, and June 30, 2020, for 2019-20 separately.
The government had extended various timelines under the Income Tax Act, 1961, through the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020. Accordingly, the time for making investment or payments for claiming deduction under Chapter-VIA-B of IT Act that include Section 80C (LIC, PPF, NSC etc.), 80D (Mediclaim) and 80G (Donations) for the financial year 2019-20 had been extended by 3 months till June 30, 2020.
Nangia Andersen Consulting Director Shailesh Kumar said the government has introduced seventh proviso to the Section 139(1) under which a person will be required to file ITR though not liable under 139(1).
"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," Kumar said.
AKM Global Tax Partner Amit Maheshwari said this comes as a relief as now joint owners of house properties and big spenders can use the same Sahaj and Sugam forms, which are easier to fill.
The government has already extended the deadline for filing all ITRs for the financial year 2019-20 till November 30. Also the deadline for filing the tax audit report has been extended by a month till October 31.
Currently, individuals and other non-corporate taxpayers not subject to tax audit and transfer pricing are required to file ITR by July 31. Corporate taxpayers and other non-corporate taxpayers subject to tax audit (including partners/ directors of firms/ companies subject to tax audit) but not subject to transfer pricing are required to file ITR by October 31. These ITR filing deadlines have been extended till November 30.
Corporate and other taxpayers subject to transfer pricing are required to file ITR by November 30 and for them, there is no change in due date.
ITR-1 Sahaj can be filed by a resident individual whose total income does not exceed Rs 50 lakh, has one house property, and an agriculture income up to Rs 5,000, 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.
ITR-2 is filed by individuals and HUFs not having income from profits and gains of business or profession, while ITR-3 is for individuals and HUFs having income from profits and gains of business or profession.
ITR-5 is filed by LLPs and Association of Persons (AoP), ITR-6 by companies and ITR-7 by person 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.
