Income Tax Returns by Individual and HUF for Financial year 2017-18

Income tax return by Individual & HUF for the Assessment year 2018-19

Financial year 2017-18 has already ended and Income tax department has notified the electronic version of all the ITR forms. It is necessary to understand which form is applicable for which assessee and how it can be filled. This article has been prepared with a view to share the information regarding Income Tax Returns liability of Individual, HUF and firms for the Assessment Year 2018-19. This article doesn’t cover other assessee. Form ITR-1, ITR-2, ITR-3 and ITR-4 has been discussed herein. 

Who are required to file Income Tax Return?

Every Individual or HUF whose gross total income is more than the basic exemption limit in the previous year 2017-18 is obliged to file the return. Individual or HUF whose gross total income is less than the basic exemption limit for the previous year 2017-18 is not mandatorily required to file the return. However, they may file the return suo moto. Basic exemption limit for Individual and HUF for the previous year are as follows:

1. For HUF & Individuals below the age of 60 years – Rs. 2,50,000;
2. For resident Individuals who are 60* years of age but less than 80 years – Rs.3,00,000;
3. For resident Individuals who are of the age of 80* years or more – 5,00,000.

   *At any time during the financial year 2017-18.

Due Date for filing of return for Financial Year 2017-18:

For Individuals or HUF whose accounts are required to be audited shall file the return on or before 30.09.2018.

In all other cases for individual or HUF, return shall be filed on or before 31.07.2018.

What is Income tax rate for the Financial year 2017-18?

Following is the tax rate for Individual and HUF for the financial year 2017-18:

1. For HUF and Individuals below 60 years of age –

Income Tax Slabs	Tax Rate	Cess
Income up to Rs 2,50,000	Nil	–
Income from Rs 2,50,000 – Rs 5,00,000	5%	3% of Income Tax
Income from Rs 5,00,000 – 10,00,000	20%	3% of Income Tax
Income more than Rs 10,00,000	30%	3% of Income Tax

* 10% Surcharge if income exceeds Rs.50 lakh but is up to Rs. 1 crore

* 15% Surcharge if income exceeds Rs. 1 crore.

2. For Individuals who are of the age of 60 years or more but less than 80 years –

Income Tax Slabs	Tax Rate	Cess
Income up to Rs 3,00,000	Nil	–
Income from Rs 3,00,000 – Rs 5,00,000	5%	3% of Income Tax
Income from Rs 5,00,000 – 10,00,000	20%	3% of Income Tax
Income more than Rs 10,00,000	30%	3% of Income Tax

* 10% Surcharge if income exceeds Rs.50 lakh but is up to Rs. 1 crore

* 15% Surcharge if income exceeds Rs. 1 crore.

3. For Individuals who are of the age of 80 years or more–

Income Tax Slabs	Tax Rate	Cess
Income up to Rs 5,00,000	Nil	–
Income from Rs 5,00,000 – 10,00,000	20%	3% of Income Tax
Income more than Rs 10,00,000	30%	3% of Income Tax

* 10% Surcharge if income exceeds Rs.50 lakh but is up to Rs. 1 crore

* 15% Surcharge if income exceeds Rs. 1 crore.

It is to be noted that Resident Individuals whose total income is up to Rs. 3,50,000 is eligible for Rebate of Rs.2500 or tax payable, whichever is lower, from the total tax liability calculated before adding cess. It means if any Individual’s tax liability comes out to be Rs. 2200 then such Individual will be eligible for rebate of Rs. 2200 on total tax liability and his/her net tax liability will be Nil.

In other words, Income up to Rs.3,00,000 of Resident Individual will fetch NIL income tax for FY 2017-18.

ITR-1 SAHAJ for A.Y. 2018-19:

Who can use this ITR form?

ITR-1 Sahaj form can be used only by an Individual who fulfils the following conditions:

1. Individual must be Resident other than not ordinarily resident;
2. Total Income doesn’t exceed Rs.50 Lakh;
3. Total Income only includes Income from Salary/one house property/Income from other sources;
4. Total Income doesn’t includes winning from lottery, horse race, income u/s 115BBDA or 115BBE);
5. Individual doesn’t have income from any source outside India or doesn’t have any asset located outside India;

Notes:

• Form can be downloaded from the following link – https://www.incometaxindia.gov.in/Pages/downloads/income-tax-return.aspx?c=0
• No document is needed to be attached to ITR-1 Sahaj.
• ITR-1 Sahaj can be filed in paper or electronic form.
• Paper mode is available only for Individuals of the age of 80 years or more OR Individual or HUF Whose total income is up to Rs.5 lakh and no refund is claimed.
• Electronic submitted return can be verified through EVC, Digital Signature or by submitting ITR-V.
• Duly signed ITR-V must be sent to CPC of Income Tax Department, Bengaluru if the verification mode is through ITR-V.

General Instruction/Information to fill ITR-1 Sahaj:

• Provide the correct Mobile Number and Email Id so as to ensure faster communication.
• Fill the correct details of salary/ pension, allowances not exempt, deductions u/s 16 etc.
• Furnish the detail of house property, whether self-occupied or let out.
• Any loss figure must start with “(-)” symbol.
• Provide the details of income from other sources. If there is loss from other sources then ITR-2 shall be used.
• Provide the details of deduction claimed under chapter VI-A.
• Provide the details of all bank accounts held at any time during the previous year. Dormant accounts are not required to be reported.
• Return can only be filed after the payment of self-assessed tax, if any.
• Provide the details of Advance tax or self-assessment tax paid.
• Aggregate amount of deduction that can be claimed under section 80C, 80CCC and 80CCD(1) shall not exceed Rs. 1,50,000.
• Maximum deduction in respect of interest from savings account deposit is Rs. 10,000.

ITR-2 for A.Y. 2018-19

Who can use this ITR form?

ITR-2 form can be used only by an Individual or a HUF who fulfils the following conditions:

1. Individual or HUF who is not eligible to file ITR-1 Sahaj;
2. Individual or HUF who is not having any income under the head “Profit or gains of business or profession;
3. Individual whose total Income exceed Rs.50 Lakh but not having any business or professional income;
4. Individual doesn’t have income from any source outside India or doesn’t have any asset located outside India;

Notes:

• Form can be downloaded from the following link – https://www.incometaxindia.gov.in/Pages/downloads/income-tax-return.aspx?c=0
• ITR-2 can only be filed in electronic mode.
• Electronic submitted return can be verified through EVC, Digital Signature or by submitting ITR-V.
• Duly signed ITR-V must be sent to CPC of Income Tax Department, Bengaluru if the verification mode is through ITR-V.
• It has been advised to match the taxes deducted/collected/paid by or on behalf of the tax-payer with their Form 26AS.

General Instruction/Information to fill ITR-2:

• Provide the correct Mobile Number and Email Id so as to ensure faster communication.
• There are total 18 schedules to the form. Applicable schedules to be filled in reference to the information entered in “Part B – TI” section of the form.
• Detailed information about employer and salary structure to be entered into Schedule S of the form.
• Detailed information regarding house property or income from house property to be entered into Schedule HP of the form.
• Any capital gain shall be segregated according to specific sections and details to be entered into Schedule CG of the form.
• Details about income from other sources shall be explained in Schedule OS of the form.
• If there is a loss under one or more head in the current year, it should be shown and set off under Schedule CYLA according to set off provision.
• Any brought forward losses of earlier years should be specified and set off under Schedule BFLA of the form.
• If after set off of current year and brought forward losses, any loss arises which needs to be carried forward to future years, details of same shall be entered in Schedule CFL of the form.
• Section wise details of deductions claimed under chapter VI-A shall be mentioned under Schedule VI-A of the form.
• Schedule 80G of the form requires the details of donations made u/s 80G along with name and PAN of each donee.
• If income of any specified person is to be clubbed with the income of the assessee then such details to be filled in Schedule SPI of the form.
• If any of the income shown in the form is taxable at a special rate then it should be checked/selected under Schedule SI of the form.
• Details of all exempt income must be provided in Schedule EI of the form.
• Any income from Business Trust or Investment Fund as per section 115UA, 115UB shall be mention in schedule PTI of the form.
• Details of all income accruing or arising outside India shall be filled in Schedule FSI of the form.
• Details of tax relief claimed u/s 90, 90A or 91 shall be provided in schedule TR of the form.
• Details of all foreign assets and income outside India shall be provided in Schedule FA of the form.
• In case total income exceeds Rs. 50 Lakh, details of Asset and Liability at the end of the year shall be furnished in Schedule AL of the form.
• If any item in the schedule is not applicable, then “NA” should be written against that item. Don’t leave the item blank.
• “NIL” should be written at all places to denote nil figures. Don’t leave the figure blank.
• PART-A, PART B-TI, PART B-TTI shall be filled first in the sequence it is mentioned.
• Verification part and details of TRP shall be entered thereafter in the sequence mentioned.
• Schedules shall be filled at the last.
• Return can only be filed after the payment of self-assessed tax, if any.
• Provide the details of Advance tax or self-assessment tax paid.
• Aggregate amount of deduction that can be claimed under section 80C, 80CCC and 80CCD(1) shall not exceed Rs. 1,50,000.
• Maximum deduction in respect of interest from savings account deposit is Rs. 10,000.

ITR-3 for A.Y. 2018-19

Who can use this ITR-3 form?

ITR-3 form can be used only by an Individual or a HUF who is having any income under the head “Profit or gains of business or profession” and who is not eligible to file ITR-4 (SUGAM).

Notes:

• Form can be downloaded from the following link – https://www.incometaxindia.gov.in/Pages/downloads/income-tax-return.aspx?c=0
• ITR-3 can only be filed in electronic mode.
• Electronic submitted return can be verified through EVC, Digital Signature or by submitting ITR-V.
• Duly signed ITR-V must be sent to CPC of Income Tax Department, Bengaluru if the verification mode is through ITR-V.
• If the books of accounts are required to be audited then return shall be furnished and verified through Digital Signature only.
• It has been advised to match the taxes deducted/collected/paid by or on behalf of the tax-payer with their Form 26AS.
• Any audit report under sections 10AA, 44AB, 44DA, 50B, 80 -IA, 80-IB, 80-IC, 80-ID, 80JJAA, 80LA, 92E, 115JB or 115JC shall be filed electronically on or before the date of filing of return.

General Instruction/Information to fill ITR-3:

• Provide the correct Mobile Number and Email Id so as to ensure faster communication.
• There are total 33 schedules to the form. Applicable schedules to be filled in reference to the information entered in “Part B – TI” section of the form.
• Details of auditor and audit report, if applicable, shall be furnished in the Audit Information section of the form.
• Auditor must have been added/authorised, if not already added/authorised, against your PAN by logging into Income Tax Site. Without this, auditor cannot upload audit report or other required documents.
• Enter the Code for Nature of business or profession and its description.
• Figures shall be provided in Part A-BS as on 31.03.2018.
• Details of Profit and Loss Account shall be furnished into Part A- P&L of the form. For those maintaining regular books of accounts, Item 1 to 52 under Part A – P&L shall be filled otherwise Item 53 shall be filled.
• Part A-OI shall be filled mandatorily by audited assessee wherein general information about accounting method and policies adopted needs to be disclosed. This portion is optional for non-audited assessee.
• Quantitative details of the principal item of goods traded shall be furnished in Part-QD of the form. It is optional in a case not liable for audit under section 44AB.
• Total income under different heads shall be calculated or provided under PART B-TI of the form. Detailed information, wherever applicable, regarding each item shall be furnished under the applicable schedule of the form.
• Tax on total income shall be calculated under Part B-TTI of the form. Detailed information, wherever applicable, regarding each item shall be furnished under the applicable schedule of the form.
• Detailed information about employer and salary structure to be entered into Schedule S of the form.
• Detailed information regarding house property or income from house property to be entered into Schedule HP of the form.
• Detailed computation of income from business or profession shall be made under Schedule BP of the form.
• Detailed computation of depreciation on Plant & Machinery claimed shall be furnished under schedule DPM of the form.
• Detail computation of depreciation on other assets claimed shall be furnished under schedule DOA of the form.
• Summary of depreciation claimed under Schedule DPM and DOA shall be furnished in Schedule DEP of the form.
• Details of deemed capital gain on sale of depreciable asset shall be mentioned in Schedule DCG of the form.
• Schedule ESR requires details information on expenses incurred under Section 35 (expenditure on scientific research).
• Any capital gain shall be segregated according to specific sections and details to be entered into Schedule CG of the form.
• Details about income from other sources shall be explained in Schedule OS of the form.
• If there is a loss under one or more head in the current year, it should be shown and set off under Schedule CYLA according to set off provision.
• Any brought forward losses of earlier years should be specified and set off under Schedule BFLA of the form.
• If after set off of current year and brought forward losses, any loss arises which needs to be carried forward to future years, details of same shall be entered in Schedule CFL of the form.
• Details of unabsorbed depreciation of previous years, set off in current year and carried forward to future years shall be furnished in Schedule UD of the form.
• Effect of ICDS on profit (either positive or negative) shall be stated in Schedule ICDS of the form.
• Details of deduction claimed under section 10AA, if applicable, shall be furnished in Schedule 10AA.
• Schedule 80G of the form requires the details of donations made u/s 80G along with name and PAN of each donee.
• Details of deduction claimed under section 80-IA to 80-IE, if applicable, shall be furnished under respective schedule of the form.
• Section wise details of deductions claimed under chapter VI-A shall be mentioned under Schedule VI-A of the form.
• Computation of AMT as per Section 115JC shall be shown in Schedule AMT.
• If any tax credit arises out of computation as per section 115JC, such tax credit shall be specified under Schedule AMTC of the form.
• If income of any specified person is to be clubbed with the income of the assessee then such details to be filled in Schedule SPI of the form.
• If any of the income shown in the form is taxable at a special rate then it should be checked/selected under Schedule SI of the form.
• Details of all partnership firms in which assessee is a partner shall be mentioned in Schedule IF of the form.
• Details of all exempt income must be provided in Schedule EI of the form.
• Any income from Business Trust or Investment Fund as per section 115UA, 115UB shall be mention in schedule PTI of the form.
• Details of all income accruing or arising outside India shall be filled in Schedule FSI of the form.
• Details of tax relief claimed u/s 90, 90A or 91 shall be provided in schedule TR of the form.
• Details of all foreign assets and income outside India shall be provided in Schedule FA of the form.
• In case total income exceeds Rs. 50 Lakh, details of Asset and Liability at the end of the year shall be furnished in Schedule AL of the form.
• If any item in the schedule is not applicable, then “NA” should be written against that item. Don’t leave the item blank.
• “NIL” should be written at all places to denote nil figures. Don’t leave the figure blank.
• PART-A, PART B-TI, PART B-TTI shall be filled first in the sequence it is mentioned.
• Verification part and details of TRP shall be entered thereafter in the sequence mentioned.
• Schedules shall be filled at the last.
• Return can only be filed after the payment of self-assessed tax, if any.
• Provide the details of Advance tax or self-assessment tax paid.
• Aggregate amount of deduction that can be claimed under section 80C, 80CCC and 80CCD(1) shall not exceed Rs. 1,50,000.
• Maximum deduction in respect of interest from savings account deposit is Rs. 10,000.

ITR-4 (SUGAM) for A.Y. 2018-19

Who can use this ITR-4 (Sugam) form?

ITR-4 SUGAM form can be used by an Individual/HUF/Partnership firm whose total income includes-

1. Where business income is computed in accordance with the provision of Section 44AD and 44AE;
2. Where income from profession is computed in accordance with the provision of section 44ADA;
3. Salary/Pension;
4. Income from One House Property (excluding cases where there is brought forward loss or loss to be carried forward under this head); or
5. Income from Other Sources (excluding Winning from Lottery and Income from Race Horses).

Who cannot use this ITR form?

SUGAM cannot be used in following cases: –

• Income from more than one house property or where there is brought forward loss or
• loss to be carried forward under this head; or
• Income from Winnings from lottery or income from Race horses; or
• Income under the head ―Capital Gains‖, e.g. Short-term capital gains or long-term
• capital gains from sale of house, plot, shares etc.; or
• Income taxable under section 115BBDA; or
• Income of the nature referred to in section 115BBE; or
• Agricultural income in excess of ₹5,000; or
• Income from Speculative Business and other special incomes; or
• Income from an agency business or income in the nature of commission or
• brokerage; or
• Person claiming relief of foreign tax paid under section 90, 90A or 91; or
• Any resident having any asset (including financial interest in any entity) located
• outside India or signing authority in any account located outside India; or
• Any resident having income from any source outside India.

Notes:

• Form can be downloaded from the following link – https://www.incometaxindia.gov.in/Pages/downloads/income-tax-return.aspx?c=0
• ITR-4 can be filed in paper or electronic mode.
• The income computed under the aforesaid sections shall be presumed to have been computed after giving full effect to every loss, allowance, depreciation or deduction under the Income-tax Act.
• No document is needed to be attached to ITR-4 SUGAM.
• ITR-4 SUGAM can be filed in paper or electronic form.
• Paper mode is available only for Individuals of the age of 80 years or more OR Individual or HUF Whose total income is up to Rs.5 lakh and no refund is claimed.
• Electronic submitted return can be verified through EVC, Digital Signature or by submitting ITR-V.
• Duly signed ITR-V must be sent to CPC of Income Tax Department, Bengaluru if the verification mode is through ITR-V.
• In case of a firm, option to file return in paper form is not applicable.

General Instruction/Information to fill ITR-4 Sugam:

• Provide the correct Mobile Number and Email Id so as to ensure faster communication.
• Provide the details of Income form business or profession in Part B of the form.
• Fill the correct details of salary/ pension, allowances not exempt, deductions u/s 16 etc.
• Furnish the detail of house property, whether self-occupied or let out.
• Any loss figure must start with “(-)” symbol.
• Provide the details of income from other sources.
• Provide the details of deduction sought under chapter VI-A.
• Provide the details of all bank accounts held at any time during the previous. Dormant accounts are not required to be reported.
• Return can only be filed after the payment of self-assessed tax, if any.
• Provide the details of Advance tax or self-assessment tax paid.
• Aggregate amount of deduction that can be claimed under section 80C, 80CCC and 80CCD(1) shall not exceed Rs. 1,50,000.
• Enter the Code for Nature of business or profession and its description.
• Details of Income from business or profession shall be provided in Schedule BP of the form. Gross receipts bifurcated into electronic or cash mode should be entered according to which tax rate will be applicable.
• In case total income exceeds Rs. 50 Lakh, details of Asset and Liability at the end of the year shall be furnished in Schedule AL of the form.
• Detailed information regarding TCS and TDS shall be filled.

This article has been written by Siddarth Agarwal, Practising Company Secretary carrying his practice in Delhi-NCR and Guwahati. Due care has been taken to ensure the correctness of information. However, this article cannot be construed as legal opinion and author will not be liable for any claim. Any suggestions are welcome to increase the effectiveness of the article. For detailed analysis on any of the provision or for any query, writer can be contacted on the given contact details.

You can reach him on +91 99998 42474 or +91 84710 19192 or through email – Siddarth.grwl@gmail.com