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Instructions for filling out FORM ITR-5

These instructions are guidelines for filling the particulars in Income-tax Return Form-5 for the Assessment Year 2022-23 relating to the Financial Year 2021-22. In case of any doubt, please refer to relevant provisions of the Income-tax Act, 1961 and the Income-tax Rules, 1962.

1. Assessment Year for which this Return Form is applicable

This Return Form is applicable for assessment year2022-23only, i.e., it relates to income earned in Financial Year 2021-22.

2. Who is eligible to use this Return Form?

This Form can be used by a person being a firm, Limited Liability Partnership (LLP), Association of Persons (AOP), Body of Individuals (BOI), Artificial Juridical Person (AJP) referred to in clause (vii) of section 2(31), local authority referred to in clause (vi) of section 2(31), representative assessee referred to in section 160(1)(iii) or (iv),Primary Agricultural Credit Society, Co-operative Bank other than a primary agricultural credit society or a primary co-operative agricultural and rural development bank, Primary Co­operative Agricultural and Rural Development bank, any other cooperative society, society registered under Societies Registration Act, 1860 or under any other law of any State, trusts like Private Trust/ Private Discretionary Trust irrespective of income from Business etc which are not eligible to file Form ITR-7,estate of deceased person, estate of an insolvent, business trust referred to in section 139(4E), investments fund referred to in section 139(4F) and Any other AOP /BOI.

However, a person who is required to file the return of income under section 139(4A) or 139(4B) or 139(4D)shall not use this form.

3. Manner of filing this Return Form

This Return Form can be filed with the Income-tax Department electronically on the e-filing web portal of Income-tax Department () [www.incometax.gov.in] and verified in any one of the following manners: –

(i) digitally signing the verification part, or

(ii) authenticating by way of electronic verification code (EVC), or

(iii)Aadhaar OTP, or

(iv) by sending duly signed paper Form ITR-V – Income Tax Return Verification

Form by post to CPC at the following address –

“Centralized Processing Centre,

Income Tax Department,

Bengaluru— 560500,

Karnataka”.

The Form ITR-V-Income Tax Return Verification Form should reach within such time as specified from the date of e-filing the return, which is being intimated at the time of uploading the return data

The confirmation of the receipt of ITR-V at Centralized Processing Centre will be sent to the assessee over mail on the e-mail ID registered in the e-filing account.

However, in a case where accounts are required to be audited u/s 44AB, it is mandatory to verify the return electronically under digital signature.

In case an assessee is required to furnish a report of audit under sections 10AA, 44AB, 44DA, 50B, 80-IA, 80-IAC, 80-IAB, 80-IB, 80-IC, 80-ID, 80JJAA, 80LA(1), 80LA(1A) 92E, 115JB or 115JC,10(23FF), 10(4D), he shall file the report electronically on or before one month of the due date specified for filing of the return of income.

4. Filling out the ITR-V –Income Tax Return Verification Form

Where the Return Form is furnished in the manner mentioned at 3(iv), the assessee should print out Form ITR-V-Income Tax Return Verification Form. ITR-V-Income Tax Return Verification Form, duly signed by the assessee, has to be sent by ordinary post or speed post only to Centralized Processing Centre, Income Tax Department, Bengaluru– 560500 (Karnataka).

5. Key changes (as compared to ITR for AY 2021-22)

> In Part A General, new questions inserted to capture information w.r.t “Significant economic presence (SEP) in India “ in the case of non-resident Dropdowns in sl.no.A2 is modified to capture turnover more precisely.

> In Part A-OI, new field has been added after sl.no.10d, to capture in amount to be allowed as deduction for current previous year u/s 43B w.r.t payment to NBFC (sl.no. 10da).

> In Schedule DPM following have been deleted as they are not applicable from AY 2022-23 onwards

    • (3a) Amount as adjusted on account of opting for taxation under section 115BAD
    • (3b) Adjusted written down value on the first day of previous year

> As per section 48(iii), income of partnership firm as per 45(4) on transfer of capital asset to partner shall be allocated to the remaining assets of the Partnership firm and will be allowed as deduction while transfer of other assets and hence for giving the benefit of such deduction in schedule Capital gain , one new line item has been inserted under clause deduction under section 48 as under:

“Reduction as per clause (iii) of section 48 of the Act, read with rule 8AB of the Rules”

> As per the Finance Act, 2021, a new rule 11UAE has been inserted for working of capital gain in case of slump sale and hence to give effect of the rule 115UAE in schedule CG (Long term and short term), capital gain from Slump sale has been amended as under:

Higher of the i or ii will be treated as full value of consideration

i Fair market value as per Rule 11UAE(2)

ii Fair market value as per Rule 11UAE(3)

> In Schedule OS, sl.no.2c and sl.no.2d of notified form is modified to be in sync with utilities of AY 2021-22 by adding “Income being dividend/ other than dividend received by a specified fund u/s 115AD(1)(i). Also, existing dropdown of 115AC(1)(a & b) has been bifurcated to 115AC(1)(a) and 115AC(1)(b). Corresponding changes are made in schedule Special Income.

(i) In sl. No. 3, a new field “eligible interest expenditure u/s 57(i)” has been added to the column of deduction under section 57

> In existing fields of Sl. No. 10 “Information about accrual/receipt of income from Other Sources” the segregation of dividend income has been made for calculation of the interest u/s. 234C of the Act.

> In schedule 80GGA, field for date of donation in cash is removed

> In Schedule 80-IA, following options have been removed.

b. Deduction in respect of profits of an undertaking referred to in section 80-IA(4)(ii) (Telecommunication services)

c. Deduction in respect of profits of an undertaking referred to in section 80-IA(4)(iii) (Industrial Park and SEZs)

e. Deduction in respect of profits of an undertaking referred to in section 80-IA(4)(v) (Revival of power generating plant) and Deduction in respect of profits of an undertaking referred to in section 80-IA(4)(vi) (Cross country natural gas distribution network)

> In Schedule 80-IB, following options have been removed.

Deduction in the case of multiplex theatre section 80-IB(7A)

Deduction in the case of convention centre section 80-IB(7B)

Deduction in the case of an undertaking engaged in operating and maintaining a rural hospital section 80-IB(11B)

Deduction in the case of an undertaking engaged in operating and maintaining a hospital in any area, other than excluded area section 80-IB(11C)

> In Schedule AMT ‘Adjusted Total Income under section 115JC(1)’ will be taxed at the rate of 9% if units are located in IFSC and for the units other than IFSC units the AMT tax rate will be 18% .

> New sections has been inserted section 10(23FF) for not taxing the income of capital gain by non-resident if transfer of share is happened due to relocation of fund and section 10(4D) prescribing the method of calculating the exempt income of specified fund u/s 10(4D) and taxable income u/s 115AD. Hence, in Schedule EI, under other exempt income, following has been inserted:

    • Income of investment fund referred to in section 10(23FB) or 10(23FBA)
    • Income of a business trust referred to in section 10(23FC) or 10(23FCA)
    • Income exempt u/s 10(23FE) or 10(23FF) or 10(4D)
    • Any other Income (Specify nature – Add row option to be provided in utility

> In Schedule TPSA, to simplify the structure of the ITR formnow instead of providing primary adjustments, assessment year wise total aggregate of adjustments is to be provided

> In schedule FA, the details are to be filled for calendar year (Jan-Dec) instead of Financial Year (Apr-Mar)

> In Part BTI, in Sl.no. 12, Total deductions is to be inserted now instead of individual income wise deduction as the same has been removed from here and now it is shown under the Schedule EI

> Upload level validations table is modified wrt mapping changes and new rules.

Read Full text of Instructions for filling ITR-5 For A.Y. 2021-22 | F.Y. 2022-23

(Republished with amendments)

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