Much to the relief of tax payers in the country, Finance Ministry has issued a fresh notification regarding filing of Income Tax for the financial year 2014-15 (Assessment year 2015-16) making the process even simpler.
As per the proposal shared by the Government, a new ITR 2A form will be provided, which will have only 3 pages to fill. Infact for both ITR 2 and ITR 2A, the same format has been proposed, which is a welcome relief from the dreaded 14 page format followed as of now.
The format of existing IT Return forms was criticized and condemned by the business community and tax payers all over the country.
Major highlights from the notification released by Ministry of Finance:
- No need to provide details about foreign trips and visits in the IT Return form; this is a huge relief for those who wish to keep their privacy intact. Under the new rules, only Passport number needs to be entered.
- No need to provide balance details of your various bank accounts. However, IFSC code and bank account numbers of all saving/current bank accounts needs to be updated. Considering that IT Dept. already has PAN Card details of all tax payers, extracting this information won’t be a huge task for the Govt. Additionally, the tax payer doesn’t need to provide information on the dormant accounts, which are older than 3 years.
- IT Department is creating a new online based tool for filing IT Returns, which will be active within June 3rd week. Tax Payers can directly log on to the tool, and file their returns.
- In case there are other details which are required by the IT Dept., then the user will be notified regarding the same via schedules. This makes the initial filing of taxes easy and fast.
- The last date for filing IT Returns have been extended till August 31.
About ITR 1, 2 and 2A
In the note released by the Finance Ministry, the definition and purpose of the ITR forms have been clearly stated. ITR 2A is for those tax payers and Hindu Undivided Family (HUF) who own more than one house property but do not have capital gains from the same.
ITR 2 is for those who own more than one house property and have capital gains from the same.
Meanwhile ITR 1 is for those who have only 1 house property, and earning capital gains from the same. Additionally, ITR 1 will also be applicable to those whose agricultural income exceeds Rs 5000 annually.
Easier Norms for Expats & Foreign Nationals
Expats and Foreign Nationals who are not Indians and are living in India on either business purpose, employment purpose or education need not declare their overseas assets and income while filing for IT Returns. This is a huge relief for them, as they could have been prosecuted under the new ‘Black Money Law’ being implemented in India.
The Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015 or the Black Money law has powers to imprison an expat or a NRI for 5-6 years for ‘willful attempt to evade taxes’ and for failure to file return of foreign assets and bank accounts.
You can find the official notification from the Finance Ministry below :
Press Information Bureau
Government of India
Ministry of Finance
31-May-2015 13:53 IST
Income Tax Return Forms ITR 1, 2 and 4S Simplified for Convenience of the Tax Payers;
A New Form ITR 2A Proposed which can be Filed by an Individual or HUF who does not have Capital Gains, Income from Business/Profession or Foreign Asset/Foreign Income; In Form ITR 2 and the New Form ITR 2A, the Main Form will not Contain more than 3 Pages, and other Information will be Captured in the Schedules which will be Required to be filled only if applicable;
As the Software for these Forms is under Preparation, they are likely to be available for e-filing by 3rd week of june 2015;Time Limit for Filing these Returns is also Proposed to be Extended up to 31.08.2015;
Only Passport Number, if available, would be required to be given in forms Itr-2 and itr-2A. Details of Foreign Trips or Expenditure thereon are not required to be Furnished
Forms ITR 1, 2 and 4S for Assessment Year 2015-16 were notified on 15th April 2015 (15.04.2015). In view of various representations, it was announced that these ITR forms will be reviewed. Having considered the responses received from various stakeholders, these forms are proposed to be simplified in the following manner for the convenience of the taxpayers:-
1) Individuals having exempt income without any ceiling (other than agricultural income exceeding Rs. 5,000) can now file Form ITR 1 (Sahaj). Similar simplification is also proposed for individuals/HUF in respect of Form ITR 4S (Sugam).
2) At present individuals/HUFs having income from more than one house property and capital gains are required to file Form ITR-2. It is, however, noticed that majority of individuals/HUFs who file Form ITR-2 do not have capital gains. With a view to provide for a simplified form for these individuals/HUFs, a new Form ITR 2A is proposed which can be filed by an individual or HUF who does not have capital gains, income from business/profession or foreign asset/foreign income.
3) In lieu of foreign travel details, it is now proposed that only Passport Number, if available, would be required to be given in Forms ITR-2 and ITR-2A. Details of foreign trips or expenditure thereon are not required to be furnished.
4) As regards bank account details in all these forms, only the IFS code, account number of all the current/savings account which are held at any time during the previous year will be required to be filled-up. The balance in accounts will not be required to be furnished. Details of dormant accounts which are not operational during the last three years are not required to be furnished.
5) An individual who is not an Indian citizen and is in India on a business, employment or student visa (expatriate), would not mandatorily be required to report the foreign assets acquired by him during the previous years in which he was non-resident if no income is derived from such assets during the relevant previous year.
6) As a measure of simplification, it has been endeavoured to ensure that in Form ITR 2 and the new Form ITR 2A, the main form will not contain more than 3 pages, and other information will be captured in the Schedules which will be required to be filled only if applicable.
As the software for these forms is under preparation, they are likely to be available for e-filing by 3rd week of June 2015. Accordingly, the time limit for filing these returns is also proposed to be extended up to 31st August, 2015 (31.08.2015). A separate notification will be issued in this regard.
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