Arjun (Fictional character): Krishna, what are the changes made in the New Income Tax return forms (ITR forms) from 1st April 2016? Just like new sequels of films have released such as Singham returns, Tanu weds manu returns, Etc. the audience waits to see what’s new in movie and the tax payer waits for the new version of Income Tax Returns. Let’s discuss in fun loving way the similarity in movies and Income tax returns.
Krishna (Fictional character): Arjun, it is true that like sequels of movies, there are many new twists and tricks in old and new ITR forms. CBDT has released ITR forms at the beginning of the Financial Year i.e. 1st April 2016. There are 9 types of Income Tax returns forms available. In each returns every year additional information is being asked. This leads to strengthen tax compliance and reduce evasion. Movies are released after a lot of efforts and research and the basic motive is to earn profit, whereas Income Tax returns are also released after a lot of legal and technical research and the basic motive is to earn tax revenue. Like movies, taxpayer has to face censorship of tax authorities.
Arjun: Krishna, What are the important changes made in ITR-1 applicable to salaried persons?
Krishna: Arjuna, as per new ITR-1 from, salaried persons have to give details of all assets & liabilities in case of income exceeding Rs. 50 lacs. These details consist of information regarding Land, Building, Cash, Jewellery & Vehicle and Liabilities in relation to these assets. This is a very important change made in ITR-1. These details are also required to be provided in ITR 2, 2A and 3. Therefore, it is now mandatory for all individual taxpayers to provide Assets-Liabilities details in case of Income exceeds Rs. 50 lacs. Earlier this information was required to submit in case of individuals who are businesspersons and professionals and having income more than Rs. 25 lacs.
Thus like big budget movies, big budget tax payers above 50 Lakhs income will have to face the test.
Arjun: Krishna, what are the important changes made in ITR-4 applicable for income business and profession?
Krishna: Arjuna, in the ITR-4 form, it is mandatory to provide information as per Income Computation and Disclosure Standards (ICD Standards) and effect of the same on income. There are 10 ICD Standards which are applicable from F.Y. 2015-16 to all businessmen. This will lead to more litigation if not followed by taxpayer. Many times movies are inspired by foreign stories, like wise now income tax returns have new plot of story inspired by ICDS.
Arjun: Krishna, what are the changes made applicable in other returns?
Krishna: Arjuna, there are various changes made effective in new ITR forms, which are –
Many other small changes are made. Like in movies sequels, new changes are made. Further like in movies, there is a hero, heroine, villains, etc.. Every tax laws has its own star cast i.e, favourable, penal, etc. provisions. Movies are also given tax free status, thus some income are also tax free. Just tax payer has to earn it legally and disclose it in income tax returns.
Arjun: Krishna, what should the taxpayer learn from the foresaid changes?
Krishna: Arjuna, due to various amendments in the provision under the Income Tax law, changes are made in the ITR forms. Digitisation/automation would help the Government to collect the information to detect tax evasion. It is taxpayers’ responsibility to disclose all the information in the ITR forms. Government obtains information from various sources about taxpayer. It is now easier for the Government to track non-filers of ITR form or defective /incomplete return filers. It is the responsibility of the tax payer to provide accurate and complete information in the ITR forms. To prepare movie director and actors, film units take years to shoot it, when released it’s the audience who gives verdict for hit or flop. Just like movies taxpayer has to work hard for the whole year to earn, and file return, it’s the taxman who gives the verdict whether the return filed is hit (Correct) or flop (Incorrect). If taxpayer files returns as per censorship of tax authorities then it will be accepted or else it will be banned i.e, tax payer may be called for enquiry. Like in movies, follow censorship rules for audience to enjoy it, follow tax rules and enjoy life, dear tax payers.