Overview of Income-tax Return Forms

Overview of Income-tax Return Forms Seminar Organized by Members of International Tax CA. Group August 08, 2015 Presented by: CA. Ashish Garg Email: citycaashish@gmail.com Mobile No.: +919873467270 August 08, 2015 1

Income-tax Return ( ITR ) Forms applicable for the Financial Year ( FY ) 2014-15 August 08, 2015 2

Contents Relevant Provisions ITR Forms An Overview Comparison Annexure August 08, 2015 3

Relevant Provisions August 08, 2015 4

Filing of Return of Income ( ROI ) Section 139(1): Obligation to file ROI Every person being a company or a firm; or being a person other than a company or a firm, if his total income or the total income of any other person in respect of which he is assessable under the Income tax Act, 1961 ( Act) during the previous year exceeded the maximum amount not chargeable to tax, Shall on or before the due date, furnish a return of his income or the income of such other person during the previous year in the prescribed form 1 and verified in the prescribed manner and setting forth such other particulars as may be prescribed. 1 Rule 12 of the Income-tax Rules, 1962 August 08, 2015 5

Filing of Return of Income ( ROI ) Date of Filing of ROI September 30 / November 30 # July 31* A company A person (other than a company) whose accounts are required to be audited under the Act or any other law A working partner of a firm whose accounts are required to be audited under the Act or any other law Any other Assessee # Assessee who are required to furnish report under section 92E of the Act * Due date extended to August 31, 2015 by Central Board of Direct Taxes ( CBDT ) order dated June 10, 2015 August 08, 2015 6

Filing of Return of Income ( ROI ) Which all assessees are required to file the ITR electronically? All companies (with digital signatures); Individual, HUF, Firms, LLP subject to tax audit u/s 44AB (with digital signatures); Individual/ HUF (other than individual of age 80 years or more) - whose total income exceeds INR 5 lakhs or if any refund is claimed in ITR (with or without digital signatures); Every person claiming relief under section 90, 90A or 91; Resident individuals and HUF having assets (including financial interest in any entity) located outside India or signing authority in any account located outside India (with or without digital signatures) or income from source outside India August 08, 2015 7

ITR Forms An Overview August 08, 2015 8

ITR Forms An Overview CBDT vide its notification number 41/2015, dated April 15, 2015 notified forms ITR- 1, ITR- 2, and ITR- 4S for the Assessment Year (AY) 2015-16 Pain points in earlier ITR forms, such as Details of all dormant bank accounts (not operational during the last three previous years) Bank balances as on March 31, 2015 Details of foreign travel including passport number, date of issue of passport, issuing country, number of times travelled and expenditure incurred Representations made before the CBDT on difficulties in furnishing details required in the ITR forms CBDT vide notification number 49/2015, dated June 22, 2015 amended the earlier notification and prescribed new ITR forms i.e. ITR- 1, ITR- 2, ITR- 2A and ITR- 4S Return filing date extended to August 31, 2015 from July 31, 2015 Further, CBDT vide its notification number 61/2015 dated July 29, 2015 notified remaining forms ITR- 3, ITR- 4, ITR-5, ITR-6 and ITR-7 for the AY 2015-16 August 08, 2015 9

Description of ITR Forms ITR Forms ITR- 1 (SAHAJ) ITR- 2 Earlier forms (AY 2014-15) For individuals having income from salaries, one house property, other sources (interest etc.) For individuals & HUFs not having income from business or profession New forms (AY 2015-16) For individuals having income from salaries, one house property, other sources (interest etc.) For individuals & HUFs not having income from business or profession ITR-2A - For individuals and HUFs not having income from business or profession and capital gains and who do not hold foreign assets ITR- 3 For individuals/ HUFs being partners in firms and not carrying out business or profession under any proprietorship ITR -4 For individuals and HUFs having income from a proprietary business or profession For individuals/ HUFs being partners in firms and not carrying out business or profession under any proprietorship For individuals and HUFs having income from a proprietary business or profession ITR -4S (SUGAM) For individual/ HUFs having income from presumptive business For individual/ HUFs having income from presumptive business ITR -5 For persons other than individuals, HUFs, Company and person filing ITR-7 [i.e. Applicable on firms, AOPs and BOIs] For persons other than individuals, HUFs, Company and person filing ITR-7 [i.e. Applicable on firms, AOPs and BOIs] ITR -6 For Companies other than companies For Companies other than companies claiming exemption under section 11 claiming exemption under section 11 August 08, 2015 10

Which ITR form to be File - Individuals & HUFs? ITR- 1 ITR- 2A ITR- 2 Salary / Pension Income from one house Any exempt income (agricultural income only till Rs 5,000) Other sources (excluding horse races and lottery) Everything from ITR 1 + Agricultural income more than Rs 5,000 Income / loss from more than 1 house Income from lottery & race horses Everything from ITR 2A + Capital gains/ loss Foreign assets/ foreign income August 08, 2015 11

Which ITR form to be File - Individuals & HUFs? ITR- 3 Everything from ITR 2 + Share of profit of partner from a partnership firm ITR- 4 Everything from ITR 3 + Income from proprietary business or profession ITR 4S Income from presumptive basis + Everything from ITR 1 August 08, 2015 12

Comparison Old ITR forms (AY 2014-15) Vs New ITR forms (AY 2015-16) August 08, 2015 13

Broad Changes Details of all bank accounts (other than dormant accounts) - MORE SCRUTINY! Disclosure of passport number - to monitor foreign travel expenses To curb circulation of black money, disclosure for Foreign income - New Requirement! Foreign assets - More Detailed! Electronic verification for Aadhaar holders - to simplify the process of e-filing Mandatory e-filing in case of income tax refunds Automated validations during e-filings! August 08, 2015 14

Comparison ITR-1 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Applicability Non-applicability Individual Total income includes income from - Salary / pension; - One house property (excluding cases of brought forward losses); - Income from other sources (excluding income from lottery and horse races) Income from more than one house property; Income from lottery or horse race; Income under the head capital gains or business/ profession; Loss under the head other sources; Person claiming relied under section 90/91; Resident having any asset (including financial interest) located or a signing authority in any account located outside India. India Silent Residents having income from any source outside India Aadhar Number - Option to mention Aadhar Number August 08, 2015 15

Comparison ITR-1 Particulars Old ITR form (AY 2014-15) New ITR form (AY 2015-16) Bank account details Manner of filing the ITR Mandatory to provide details of one bank account Paper form; Electronically under digital signature Electronically and thereafter submitting ITR-V with CPC, Bangalore Bar-coded return Mandatory to provide details of all bank accounts held at any time during the previous year Option to indicate the bank account to credit refund Details of dormant accounts (not operational for more than 3 years) not Required Paper form; Electronically under digital signature Electronically and thereafter submitting ITR-V with CPC, Bangalore Electronic verification Aadhaar based. No need to send the ITR-V to CPC, Bangalore August 08, 2015 16

Comparison ITR-2 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Applicability Non-applicability Individual or HUF Total income includes income from salary/pension; house property; capital gains; income from other sources (excluding winning from lottery and horse races) Income from more than one house property; Income from lottery or horse race; Income under the head capital gains or business/ profession; Loss under the head other sources; Person claiming relied under section 90/91; Resident having any asset (including financial interest) located India or a signing authority in any account located outside India. Silent Residents having income from any source outside India Aadhar Number - Option to mention Aadhar Number August 08, 2015 17

Comparison ITR-2 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Applicability Non-applicability Individual or HUF Total income includes income from salary/pension; house property; capital gains; income from other sources (excluding winning from lottery and horse races) Total income includes income under the head business/profession Aadhar Number Passport number to be disclosed Passport number - Option to mention Aadhar Number Bank account details Mandatory to provide details of one bank account Mandatory to provide details of all bank accounts held at any time during the previous year Option to indicate the bank account to credit refund Details of dormant accounts (not operational for more than 3 years) not required August 08, 2015 18

Comparison ITR-2 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Foreign asset/ income detail - in form Do you have,- any asset (including financial interest in any entity) located outside India signing authority in any account located outside India Do you at any time during the PY,- hold, as beneficial owner, beneficiary or otherwise, any asset (including financial interest in any entity) located outside India; signing authority in any account located outside India; have any income from any source outside India Details on foreign assets and income from any foreign source in schedule Less details More detailed. Additional information are: Status Owner/ Beneficiary; Account opening date; Interest accrued in the account Interest taxable and offered in return August 08, 2015 19

Comparison ITR-2 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Capital gain account scheme (CGAS) - Furnish details of amount deemed to be short/long term capital gains during the previous year due to non-utilization of amount lying in CGAS within the prescribed time limit Capital gains - Furnish detail of short/long term not chargeable capital gains not chargeable to tax as to tax due to per DTAA DTAA for NR with information on country name, code, article of DTAA, TRC détails etc. Exempt income One liner net agricultural income More details to be furnished: Gross agricultural receipts Expenditure incurred Unabsorbed agricultural loss of previous eight AYs Net agricultural income August 08, 2015 20

Comparison ITR-2 Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Income from other sources Income chargeable to tax at special rates For non-residents, income chargeable to tax as per DTAA with information on country name, code, article of DTAA, TRC details, corresponding section of the Act which prescribes the rate and amount of income August 08, 2015 21

Comparison ITR-4s Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Applicability Non-applicability Individual or HUF Total income includes income from salary/ pension; house property; capital gains; income from other sources (excluding winning from lottery and horse races) Income from more than one house property; Income from lottery or horse race winning; Income under the head capital gains; Income from speculative business and other special incomes; Income from profession as referred in 44AA(1), agency business, commission; Person claiming relied under section 90/91; Resident having any asset (including financial interest) located outside India or a signing authority in any account located outside India August 08, 2015 22

Comparison ITR-4s Particulars Old ITR Form (AY 2014-15) New ITR Form (AY 2015-16) Non-applicability Resident having any income from any source outside India Resident having any income from any source outside India Agricultural/ exempt income > Rs 5,000 Agricultural income > Rs 5,000 Aadhaar number - Option to mention Aadhaar Bank account details Mandatory to provide details of one bank account Mandatory to provide details of all bank accounts held at any time during the previous year Option to indicate the bank account to credit refund Details of dormant accounts (not operational for more than 3 years) not required August 08, 2015 23

New Form- ITR 2A Particulars Applicability Non-applicability Aadhaar number Details Individual or HUF Total income includes income from salary/ pension; house property; income from other sources (including winning from lottery and horse races) Income under the head capital gains Income from business/profession Person claiming relied under section 90/91 Resident having any asset (including financial interest) located outside India or a signing authority in any account located outside India Resident having any income from any source outside India Option to mention Aadhaar Passport number Passport number to be disclosed August 08, 2015 24

Practical issues Disclosure of IFOS not chargeable to tax due to DTAA? Furnishing of all bank account details for expatriates? Furnishing of bank account in case of joint holders? Declaration for existence of TRC required for capital gains and IOS. No such declaration for income under the head salaries for expatriates! Procedure for electronic verification not in place! August 08, 2015 25

Questions?? August 08, 2015 26

Annexures August 08, 2015 27

ITR 1 Aadhaar number August 08, 2015 28

ITR 1 Bank account detail Old New August 08, 2015 29

ITR 2 Passport number August 08, 2015 30

ITR 2 Foreign asset & income disclosure August 08, 2015 31

Beneficial owner/ Beneficiary Beneficial owner in respect of an asset means an individual who has provided, directly or indirectly, consideration for the asset and where such asset is held for the immediate or future benefit, direct or indirect, of himself or any other person Beneficiary in respect of an asset means an individual who derives benefit from the asset during the previous year and where the consideration for such asset has been provided by any person other than such beneficiary August 08, 2015 32

Financial Interest Financial interest would include, but would not be limited to, any of the following:- 1) if the resident assessee is the owner of record or holder of legal title of any financial account, irrespective of whether he is the beneficiary or not; 2) if the owner of record or holder of title is one of the following:- an agent, nominee, attorney or a person acting in some other capacity on behalf of the resident assessee with respect to the entity a corporation in which the resident owns, directly or indirectly, any share or voting power a partnership in which the resident assessee owns, directly or indirectly, an interest in partnership profits or an interest in partnership capital a trust of which the resident has beneficial or ownership interest any other entity in which the resident owns, directly or indirectly, any voting power or equity interest or assets or interest in profits. August 08, 2015 33

ITR 2 Foreign asset & income disclosure August 08, 2015 34

ITR 2 Foreign asset & income disclosure August 08, 2015 35

ITR 2 CAGS and non-resident Capital gain account scheme August 08, 2015 36

ITR 2 Exempt income Old New August 08, 2015 37

ITR 2 IFOS Income from other sources August 08, 2015 38

Aadhaar number ITR 4S Aadhaar number August 08, 2015 39

ITR 4S Bank account detail Old New August 08, 2015 40

Thanks!! Compiled by: CA. Ashish Garg Email: citycaashish@gmail.com Mobile: +919873467270 August 08, 2015 41

Comparative Chart of Applicability of Income-tax Return Forms AY 2015-16 PARTICULARS ITR 1 (SAHAJ) ITR 2 ITR 2A ITR 3 ITR 4 ITR 4S (SUGAM) ITR 5 ITR-6 ITR 7 Individual - - - HUF - - - - Salary/ Pension - - - - House Property One More than one - - Current Year/ Brought forward losses - Profits and gains from business and profession Income computed under section 44AD & 44AE - - - - only income u/s 44AE Other than income under 44AD & 44AE - - - - Capital Gain - - Income from other sources Income from lottery and horse races - - - Other than lottery and horse races Losses under other sources - Claiming relief under section 90 / 91 - - - - Resident having any asset (including financial interest) located outside India or signing authority in any account located outside India - - - Resident having income from any source outside India - - - Agricultural income Agricultural income in excess of Rs. 5,000 Agricultural Income upto Rs. 5,000 - - - - - `- Details of expenditure incurred on Agriculture and - Unabsorbed agricultrual loss of previous 8 AYs - - Silent Income from speculative business or other special incomes - - - - - ' D E ledeeeddeeded

Analysis of ITR-6 Form applicable for AY 2015-16 S. No. Parts Sub category 1 A General Change in format General - Filling Status Form reference numbers (f) Additional information Whether the corporate assessee is an FII/DPI and if yes, then seeks SEBI registration number 2 AOI Other Information Other Information 7(h) Expenditure incurred on corporate social responsibility (CSR) 3 B-TTI TTI Bank Account 13 Details of all Bank Accounts in India at any time during the previous year(excluding dormat accounts) Short Term Capital Gains 7(a) Whether any amount of unutilized capital gain on assets transferred during the previous years shown below was deposited in the Capital Gains Accounts Scheme wuthin the due date for the last year? 4 CG Schedule CG Long Term Capital Gain 9 8(a) 9 For NON RESIDENTS - STCG included in A1-A8 but not chargeable to tax in india as per DTAA Whether any amount of unutilized capital gain on asset transferred during the previous year shown below was deposited in the Capital Gains Account Scheme within the due date for that last year? For NON _ RESIDENTS - LTCG included in the items B1 to B8 but not chargeable to tax in India as per DTAA 5 Schedule BP Computation of income from 27 Amount allowable as deduction under section 32 AC 6 OS Scheduel OS Income from Other Sources f(iii) For Non- Residents providing details of income chargeable to be taxed under DTAA, details of country name, country code, article of DTTA, whether TRC obtained, corresponding Sec of IT Act which prescribes rate and the amount of income. 7 EI Schedule EI Exempt Income 4 Gross Agriculture receipts (other than income to be excluded under rule &A, 7B, or 8 of I.T Rules) (i)expenditure incurred on agriculture (ii)unabsorbed gricultural loss of previous eight assessment years (iii)net gricultural income for the year (i-ii-iii)(enter nil if loss) A Interest accrued in the account B Details of financial Interest in any Entity held (including any beneficial interest ) at any time during the previous year) C Details of Immovable Property held (including any beneficial interest ) at any time during the previous year)

Analysis of ITR-6 Form applicable for AY 2015-16 S. No. Parts Sub category Change in format Form reference numbers Additional information 8 FA Schedule FA Details of foreign assets and income from any source oustide India D E Details of any Capital Asset held (including any beneficial interest ) at any time during the previous year) Details of accounts in which you have signing authority held (including any beneficial interest ) at any time during the previous year and which has not been included in A to D above) F Details of trusts, created under the laws of a country outside India, in which you are a trustee, beneficiary or a settlor. G Details of any other income derived from any source outside India which is not included in - (i) items A to F above and (ii) income under the head business or profession d ' D ledeeeddeeded