The Central Board of Direct Taxes (CBDT) has notified Income-tax Return Forms (ITR Forms) for the assessment year (AY) 2023-24 in advance to ensure taxpayers get sufficient time to prepare their income returns. These ITR Forms will come into effect from April 1, 2023, the ministry of finance said in a circular.
Says Suneel Dasari, founder and CEO of EZTax.in, an online income tax filing portal: “Releasing the ITR 1–7 Forms as early as February 14 shows how serious and organised the CBDT is. It’s important to understand the contrast with the past history of such releases. This will surely translate into a higher turnout for the upcoming tax season. This would also be fantastic news for taxpayers, as they would receive their refunds much sooner.”
“With the current year’s (FY2022-23) tax collection hovering around Rs 6.73 lakh crore, we are sure the Indian economy is heading towards pre-COVID levels. An organised income tax filing process brings additional confidence to the economy,” he adds.
“To facilitate the taxpayers and improve ease of filing, no significant changes have been made to the ITR Forms in comparison to last year’s ITR Forms. Only the bare minimum changes necessitated due to amendments in the Income-Tax Act, 1961 (the ‘Act’) have been made,” says the circular.
ITR Form 1 (Sahaj) and ITR Form 4 (Sugam) are simpler Forms that cater to a large number of small and medium taxpayers. Sahaj can be filed by a resident individual having income up to Rs 50 lakh and who receives income from salary, one house property, other sources (interest, etc.), and agricultural income up to Rs 5,000.
Sugam can be filed by individuals, Hindu Undivided Families (HUFs), and firms (other than Limited Liability Partnerships (LLPs)) being a resident having total income up to Rs 50 lakh and income from business and profession computed under sections 44AD, 44ADA, or 44AE.
Individuals and HUFs not having income from business or profession (and not eligible for filing Sahaj) can file ITR Form 2, while those having income from business or profession can file ITR Form 3. Persons other than individuals, HUFs, and companies i.e. partnership firms, LLPs, etc. can file ITR Form 5. Companies other than companies claiming exemption under section 11 can file ITR Form 6. Trusts, political parties, charitable institutions, etc. claiming exempt income under the Act can file ITR Form 7.
“To further streamline the ITR filing process, not only have all the ITR Forms been notified well in time this year, no changes have been made in the manner of filing of ITR Forms as compared to last year. The notified ITR Forms will be available on the department’s website at www.incometaxindia.gov.in,” adds the circular.
Aarti Raote, Partner, Deloitte India, says: “The new ITR 1 and 2 Forms notified by the CBDT are broadly similar to that of the previous year with some additional details required to be filed in for VDA assets. There is a separate schedule for VDA that requires details like date of acquisition, date of transfer head under which income is 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. Other minor tweaks are in the general info section and TCS section.”
Changes In ITR Forms During AY 2023-24 Salaries: “There is a new disclosure for the income from retirement benefits account under scheduled salary. Income taxable during the previous year on which relief u/s 89A was claimed in any of the earlier previous years should be reported,” says Dasari.
Other Sources: There is a new disclosure requirement under Other Sources if the retirement benefits account is treated as other income. One needs to report income taxable during the previous year on which relief u/s 89A was claimed in any of the earlier previous years.
Old/New Tax Regime: A new questionnaire in ITR3 and ITR4 enquires whether you have opted out of the New Tax Regime in the earlier years.
Cryptos/VDA: There is now a new VDA schedule. The profits from VDS would now need to be reported under corresponding schedules such as business and capital gains, whereas VDA is taxable at 30 per cent.
We need to provide quarterly breakup under the Capital Gains schedule, in case VDA is treated as capital gains. One needs to report every transaction of VDA, along with the date of sale and date of purchase.
Additional Disclosures For Safeguard: If you are a foreign institutional investor (FII/FPI), you need to provide the SEBI registration number. According to new ITR Forms released, advances received from persons specified in Section 40A(2)(b) of income tax and other persons need to be reported under Advances in Source of Funds.
Also, according to the new income tax Forms released, turnover and income from the intraday trading need to be reported under the trading account.