CA Umesh Sharma

Karniti: Taxpayers please note recent changes in Income Tax Return

Keeping conversation between Lord Krishna and Arjuna as the foundation, we will learn certain basic financial and tax matter in KARNITI series of articles. Let us try to get answers to our questions in a bit different and joyful manner. The character of Arjuna will be played by the common man or tax payer and the character of Lord Shri Krishna the Expert for giving solutions to all problems. This is a small attempt to get answers to our queries related to tax matters in simple manner. There is no intention of hurting anyone’s religious feeling and this is a small attempt of knowledge sharing in a simple way.

Arjuna (Fictional Character): Krishna, June Month is coming to end. Now, it’s time to file Income Tax Returns for the year 2013-14. The due date for filing the income tax returns is 30th September for the taxpayers who are Company or to whom Tax Audit under Income Tax is applicable and for others like salaried persons, etc. the due date for filing is 31st July. That’s why; new changes are brought in various Forms of Income Tax returns.

Krishna (Fictional Character): Arjuna, all taxpayers should file income tax returns before due date. As per status and income of the taxpayers, government has defined the types of Income Tax Returns. In this year government made various changes in the forms due to amendments in laws or for what of more information for tax payers.

Arjuna: Krishna, Please tell in detail the changes that took place in Income Tax Returns?

Krishna: Arjuna the major changes in Income Tax Returns are as under:

  1. All taxpayers filing E-Returns will have to compulsorily update correct mobile number and E- Mail ID’s. Otherwise there will be login issues before uploading of return on income tax Depts Website.
  2. Now onwards Income Tax Refund will be issued directly in the bank account of the taxpayer through ECS only, cheques are discontinued. Therefore at most care should be taken while mentioning Bank Account Number and IFSC Code in the income tax returns.
  3. From this year while claiming TDS in Income Tax return facility has been given to carry forward the TDS of previous year and brought forward TDS to next year. Due to this reconciliation of TDS claimed on Income and total available TDS as per Form 26 can be made. Tax payers which follow cash system of accounting will be benefited, like Doctors, Advocates, CAs and other professionals.
  4. As per newly inserted Section 87A if annual income of the taxpayer is up to Rs. 5,00,000/- then Tax relief of maximum of Rs. 2,000/- is given. For claiming this relief separate space has been inserted in the return.
  5. As per newly inserted Section 80EE if taxpayer has purchased house up to Rs. 40 Lakh and taken housing loan of Rs. 25 Lakh then taxpayer can claim deduction of interest up to Rs. 1 Lakh. For claiming this deduction separate space has been inserted in the return.
  6. If income of the taxpayer is more than Rs. 1 crore then surcharge of 10% is applicable. For this separate space has been inserted in the return.
  7. All salaries taxpayers will now have to give now separate details of LTA (Leave Travel Allowance) and HRA (House Rent Allowance) and other allowances separately. This will help Govt. to track proper claim of such deductions, recent HRA and LTA fallacious claimed by some MPs and Govt. taxpayers may have forced for such changes.
  8. From this year the details of short and long term capital gain will have to be given in three parts viz. a) sale of plot / flat b) sale of STT paid shares and mutual funds c) sale of other assets. Further in case of sale of land or building Stamp Duty Value will have to be mentioned. Further if taxpayer is availing exemption under capital gains then value of newly purchased asset, date of acquisition of the asset and if invested in capital gain account then its details will have to be mentioned.
  9. Corporate or LLP assessee will have to mention Corporate Identification Number or LLP Identification Number. Further Director or Designated Partner Identification Number will have to be mentioned. This will help in cross check of information with other legal departments by income tax dept or visa a versa.
  10. If assessee carrying on business is taking deduction of bad debts of more than Rs. 1 Lakh of single person, then his PAN will have to be mentioned.
  11. As per newly inserted section 43 CA if, taxpayer have sold other than capital assets below stamp duty value (eg. builders / developers) then the difference between the two will be considered as deemed income of the assessee and tax will have to be paid on it. For this separate space has been inserted in the return.
  12. If there is more than one owner of the house then, while mentioning details in the schedule of Income from House Property the percentage of co ownership will have to be given.
  13. From this year e-filing of wealth tax return is compulsory and in this return the details of all wealth whether taxable or not, will have to be given in depth.

Arjuna: Krishna, What one should learn from these upcoming changes?

Krishna: Arjuna, Today computerization has increased tremendously in functioning of Tax departments. Due to which now all tax departments exchange information of taxpayers with each other. Therefore taxpayers should give correct information to all the departments without hiding and should pay appropriate tax as per laws. As one lie leads to other lie. If in one department, wrong / incorrect information is given then in other department information will have to give in same manner. All knows the Result of telling lie. Filing correct return is the responsibility of all the citizens. If returns are not filed then due to computerization on the basis of PAN of the taxpayer, information of TDS, big transactions of Banks, etc. is received by the Income tax department and they can catch hold. Now Department will immediately inform taxpayer on mobile and email. Further the notices sent through email are legally valid. Therefore taxpayer cannot find escape route of non-receipt of notice and hence compliance of law will increase.

Dear Taxguru lovers, your comments are very precious, please spare few seconds for it. Thanks.

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0 responses to “Changes in Income Tax Return (ITR) A.Y. 2014-15”

  1. DHINESHWER GOCHER says:

    I AM CRPF EMPLOYEE. IN MY PAY 2500 RATION MONEY ALLOWNCE IS GIVEN THAT ALLOWNCE WE PAY IN OUR OWN MESS WHERE WE R DEPLOYED.
    IS THIS ALLOWNCE IS IN U/S 10 REBATE AND NOT INCLUDED IN GROSS INCOME?

  2. Vipin says:

    Dear Sir,

    As per your update ,

    Now onwards Income Tax Refund will be issued directly in the bank account of the taxpayer through ECS only, cheques are discontinued. –

    But i got tax refund through Refund cheque of Assessment Year (2014-15) , even i mentioned all account details (Correct) at the time of return file with IFSC Code.

    Even in ITR-V form there is no option for refund through Cheque.

    kindly suggest why refund banker pay me through Refund cheque of Assessment Year (2014-15).

    Thanks

    Vipin

  3. krishnakumar says:

    Hi,

    For foreign companies not having bank account in India, it appears that dummy ifsc code is not working. Any suggestions?

  4. muhammed sajid says:

    dear sir

    thanke you sir

  5. s sudarshana says:

    Mr. PawanG:
    The amounts qualifying for exemption under section 10 (under Head salary S and sl no: 2 ((i) to (iv)) are to be deducted from the taxable income and to be projected as taxable income at sl. no.7. The entries under section 10 are unlike u/s 80-G etc., wherein you will include in taxable income and system will effect deduction to the extent allowed.
    Hope it is clear to you.

  6. PawanG says:

    I filling Income Tax return and have to claim for Refund for LTA for travel done in March 2014 but I am not to find the option to enter that amount(Rs. 50,000).
    I entered it under “Travel Concession [sec 10(5)]” but its not reflecting in the refund section(I am using 2 ITR Utility for file return).

    Please advise on how to claim for refund and where to enter that amount.

  7. s sudarshana says:

    Mr Dattatreyahg is very correct and brought out a very important information not provided by the IT dept while giving the refunds. Couple of years back I recalculated umpteen number of times as how the refund is more than what was due to me as per my calculation. It is wrong to expect the bank to expect the break up of amount deposited to our account. I suggest the IT dept while making the refund to send the assessment copy by email with the breakup of the refund and interest paid.
    Alternatively they should send two deposits to the assessee account, one the acutal refund and another interest on the later refund.

  8. S.C.Gupta says:

    upto date information, very nice

  9. dattatreyahg says:

    Very good&informative. Please tell this Tax Authority to add following also:—-
    1) Amount of Tax Refund still not received/ Assessment year(s) in the IT Return
    2) In the communication sent to recipient of Refund by whoever it is (Tax Authority or SBI ), pl ask them to mention clearly a) Principal Amount of Refund b) Interest on Principal Amount(which is taxable)and c) Total Amount of ECS Credit. Right now only the total Amount is mentioned by SBI. With this, Refund Receiver would not know how much ‘interest’ on which tax is payable.Query on this to SBI bounces back ” We dont have this info “. In this situation, Taxpayers are likely to think that the whole amount is the Principal Amount, and the Govt may be losing a lot of money as Tax on ‘Interest on Principal Amount of Refund’. This matter has been written about in this Blog earlier also. But there has been no ACTION from TAX-AUTHORITY. If this continues like this, it is likely to invite CAG observation one day.

  10. Avadhesh says:

    Very Good Writeup sir,

    Just excellent way of illustration given. The best example to understand.

  11. CA. Subhash Chandra Podder says:

    Good, write up. Keep it up.
    CA. Subhash Chandra Podder, FCA
    Kolkata
    30/6/2014

  12. umesh sharma says:

    Thanks to all taxguru lovers for there comments and suggestions.

  13. DEEPAK MALHOTRA says:

    Dear Sir

    As per said article you said from this year salaries person have declare the amount claim under LTA and HRA. And column will provided in Return. But I am filed the return online but there is no column are available. Kindly confirm these details are only for govt. employee or private co. employees. Please clarify and rest of the details for everyone are very useful.

  14. CA SURJEET NEGI says:

    A very Healthy Article..nice !!

    As I.T.D. is moving to paperless environment,the much awaited reforms are round the corner.

    But i think the issue that need to be addressed presently is requirement of compulsorily updated correct mobile number and E- Mail ID’s,especially for the assesses residing in remote areas/far flung areas and for senior citizens,because the same may create hardship during login before uploading of return on income tax Depts.

  15. N.K.CHHABRA says:

    THANKS FOR A VERY VALUABLE INFORMATION. YOU BE BLESSED.
    ONE POINT TO BE CLARIFIED IS THAT – BUILDER HAD TAKEN 1% TDS AMOUNT (THE PRICE OF THE FLAT IS MORE THAN 50 LAKHS) FROM THE BUYER AND DEPOSITED IN THE BANK. THE SAME IS REFLECTED IN FORM 26AS OF THE BUYER. WHERE TO SHOW IN THE ITR -2, TO CLAIM FOR THE REFUND OF THIS 1% TDS?
    WILL THE CPC TAKE COGNIZANCE OF IT AUTOMATICALLY?
    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    PLEASE TAKE UP WITH CBDT FOR EARLY REFUND OF INCOME TAX, THE SAME ARE PENDING OVER ONE YEAR…. A REQUEST

    WITH REGARDS

    N.K.CHHABRA

  16. CA Mohit says:

    nice

  17. Krushnun S says:

    Great value. Many thanks

  18. Devi Prasad says:

    Dear Sir
    Thanks for Your Valuable information that upadated all members.

    Regards

  19. Rajesh Nair says:

    ‘very fruitful information given to all. Must read and take note of it. Most welcome this kind of articles.

  20. Nem Singh says:

    Knowledgeable article but for given correct and true disclosure, application of provisions of law etc assessee depends on the professionals who are providing services and charge should be responsible to give true and correct disclosure and honestly working of tax.

  21. H. K. Jana says:

    Very nicely brought out the current year changes in the IT return form. Its very interesting and people/ tax payer’s should follow the advise of Lord Krishna.

  22. Tanmay Agarwal says:

    This article gives a synopsis of the information on filing income tax return for A.Y. 2014-15. This is a good article. I would appreciate such more articles on even untouched section of the income tax.

  23. Ravi Kumar says:

    Dear Sir,

    Thanks for new changes it will help of all the taxpayers please must read.

    Regards
    Ravi Kumar

  24. Ajay Pujara says:

    A bunch of very valuable information in a simplest manner -on the recent changes in IT E-Return filing, especially for the salaried persons -wants to file e-Return by their own for first time.

    At least 2 very good / smart changes will extraordinarily help both the parties (taxpayer -filing e-return, and the dept also):

    (a) Taxpayer is required to compulsorily update correct mobile number and E- Mail ID’s while filing e-return.
    Due to this, now Department will immediately inform taxpayer on mobile and/or, on his email, about the discrepancy / irregularity / wrong information in e-return. Taxpayer will also get any such first-hand information without any delay.

    (b) At most care should be taken while mentioning Bank Account Number and IFSC Code in the income tax returns because…., IT-REFUND Cheques are DISCONTINUED…. Now onwards Income Tax Refund will be issued directly in the bank account of the taxpayer through ECS only.

    Thank you very much for this small, but very useful attempt of knowledge sharing in such a simple & interesting way.

    Best regards,
    Ajay M Pujara

  25. Tarunkumar Trivedi says:

    This information is like butter extracted from milk, curd and buttermilk.

    Thanks

    T D Trivedi

  26. Santosh Patil says:

    Dear sir,
    thank you for good and valuable information…

  27. Geeta G Hiremath says:

    good information. .useful article to the students also.

  28. s sudarshana says:

    A must read by all tax payers as it highlights the recent changes and the need to be honest with the ‘e’ effect. More than anything else the style of narration makes it interesting!
    Of course of the information in known to most of the tax payers who are keeping in touch with the amendments.

  29. Deepak says:

    Dear Sir,
    Thanks for the valuable information
    Regards,
    Deepak

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