INCOME TAX RETURN (ITR) FORMS FOR AY 2021-22 ISSUED

A new update has been declared by the Central Board of Direct Taxation (CBDT) in relation to the ITR Forms (ITR-1 to ITR-7) in the assessment year 2021-22. The Ministry of Finance had announced that “In the view of the ongoing COVID-19 crisis and to promote the people paying tax, no important change has been done to the ITR forms with the last year’s ITR forms”. With very minor changes, the amendment to the form was bought about.

Now onwards, the taxpayers will be enabled space in the following ITR forms: Sahaj(ITR-1), (ITR-2), (ITR-3), (ITR-4) Sugam, (ITR-5), (ITR-6), (ITR-7) and Form ITR-V in order to explain their Investments.

WHY SHOULD YOU FILE INCOME TAX RETURNS ON TIME?

Income Tax Return is a form wherein the taxpayers report their information of income earned and tax applicable therein, in accordance with the Income Tax Act. While some might say filing taxes is burdensome with no benefits for the taxpayers, it is significant to note the benefits of filing Income Tax Returns on Time.

• Filing of tax returns enables the taxpayer to apply for different types of loans such as vehicle loans, house loans, etc. especially, the salaried and self-employed individuals can take advantage of income tax returns as they don’t have to provide other documents pertaining to proof of income and receive loans.

• Benefits of refund can be claimed as well, by paying the tax on time.

• It is significant while applying for visa applications as the US embassy and others might ask for the same for proof of income.

• The government also offers deductions on medical insurance to the taxpayers, up to a value of Rs. 50,000/-, as explained in Section 80D of the Income Tax Act.

ARE YOU ELIGIBLE TO FILE ITR-1 Sahaj?

Anyone who is a resident, and has a total income of up to Rs.50 lakhs from the salaries would be eligible for ITR-1(Sahaj). It can include family pension income, ownership, interest income, etc. 

However, residents, whose income exceeds Rs.50 lakhs wouldn’t be eligible to fill this form. Further, Non-Residents, Residents Not Ordinarily residents, and individuals with two or more residents wouldn’t be eligible for this ITR(Sahaj).

ARE YOU ELIGIBLE TO FILE ITR-4 Sugam?

HUFs, Individuals, and firms having total income of up to Rs.50 lakhs, along with income from a business, residential property, income from interests, family allowance, and a profession that comes under the purview of Sections  44AD, 44ADA, 44AE would be eligible for ITR-4 Sugam.

However, individuals possessing their own residential property, salary income, and income from other sources above Rs.50 Lakhs wouldn’t be eligible to file ITR-4 Sugam. Further, a person, who is a director and invested in unlisted equity shares is too ineligible.

ARE YOU ELIGIBLE TO FILE ITR-2 AND ITR-3?

HUFs (Hindu Undivided Families) and individuals not earning income from profession or business or trade (not eligible for filing Sahaj ITR-1) are eligible to file ITR-2.

Furthermore, individuals earning from profession or business can file ITR Form 3.

WHO CAN FILE ITR Form 5?

This form can be utilized by the person being a firm, AOP, BOI, LLPs, artificial juridical person as understood in Section 2(31) (vii), the estate of insolvent, business trust, investment fund, cooperative society, the estate of deceased, local authority.

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Author:

Ruprekha Jena
Bhubaneswar
3rd Year Law Student from KIIT School of Law, Bhubaneswar