By Shalini Jain
The Central Board of Direct Taxes (CBDT) notified tax return forms for the Financial Year (FY) 2018-19 on April 01, 2019.
While the type of tax return forms largely remain unchanged from previous year (no basic change in forms with respect to category of taxpayers who are required to file Form ITR 1, 2, 3 and 4), there are some additional points which require due consideration at the time of selecting the correct tax return form at the time of filing the income tax return for FY 2018-19.
The instructions to fill ITR 2 and ITR 3 tax return forms released by CBDT last week should help the taxpayers in providing correct information in the tax return form. To help the individual taxpayers pick the correct tax return form, a brief synopsis of the applicable tax return forms has been tabulated below:
|ITR Form number||Type of taxpayer||Residential status||Type of income|
|ITR 1 (SAHAJ)||Individuals*||Resident and Ordinarily Resident (ROR)||Income from salary, one house property, other sources (interest etc.). Total income should not exceed INR 50 lakhs|
|ITR 2||Individuals and HUFs||(i) Non-resident (NR), (ii) Resident but not Ordinarily Resident (RNOR), (iii) ROR||Income from salary, more than one house property, capital gains and income from other sources.|
|ITR 3||Individuals and HUFs||(i) NR, (ii) RNOR, (iii) ROR||Income from salary, house property, income from business or profession, capital gains and income from other sources|
|ITR 4 (SUGAM)||Individuals*, HUFs and firms (other than LLP)||ROR||Income from salary, one house property, other sources, income from business or profession computed under Section 44AD, 44ADA and 44AE. The total income should not exceed INR 50 lakhs|
*Director in a company or an individual having investment in unlisted equity shares of a company is not eligible to file ITR 1 and ITR 4.
Selection and filing of the correct tax return form as per the residential status, source and quantum of income is necessary as filing of an incorrect tax form may render the income tax return as defective.
The below checkbox summarises the pre-requisites on the basis of which you can select the correct tax return form for the FY 2018-19
Some of the key changes in tax forms have been highlighted below:
Enhanced reporting in relation to assets located outside India is required in ITR 2 and ITR 3 forms. Instructions to fill the tax return forms provide guidance on details to be reported by the taxpayers.
In the past, CBDT has introduced new reporting requirements in the tax return forms as and when the return filing utility is updated. The taxpayers should watch out for such changes at the time of filing of the income tax return.
(The writer is Tax Partner, People Advisory Services, EY)
(Also contributed by Akshay Sharma, Manager, People Advisory Services, EY)