Key Changes in ITR for AY 2021-22
Vide Notification No. 21/2021 dated 31st March 2021, the Central Board of Direct Taxes (CBDT) notifies Income Tax (7th Amendment) Rules 2021. In this notification, Rule 12 of the Income Tax Rule, 1962 is being amended and Income Tax Return forms for AY 2021-22 are being notified.
This year, there are very few changes in the income tax return forms. This will surely provide some ease in compliance burden on tax return preparers as well as tax payers.
In this document, we are indicating some key changes in the Income Tax Return Forms for AY 2021-22. We trust that readers will find the same useful.
Section 194N provides that the Tax is required to be deducted if the amount of cash withdrawn during the year exceeds Rs. 20 lakhs in case of certain non-filers of return and Rs. 1 crore in other cases.
Vide Income Tax (7th Amendment) Rule, 2021, the Rule 12 of the Income-tax Rules has been amended to restrict an assessee to use ITR 1, in whose case tax has been deducted u/s 194N.
Further, it is very important to note that the TDS deducted u/s 194N can not be carry forward to any other assessment year. The excess tax deducted under this section, if any, must be claimed as refund in the same of deduction.
As you are aware that, in the case of sale of Equity shares/Units of Equity Oriented Mutual Fund/Units of Business Trust, which were acquired before 31.01.2018, the cost of acquisition is computed after considering the Fair Market Value as on 31.01.2018. The ITR has been amended to allow tax payer to insert Sale Price, FMV and Cost of Acquisition in order to effectively calculate the capital gain.
ITR Forms requires the assessee to disclose the marginal relief figure separately for “Surcharge computed before marginal relief” and “Surcharge computed after marginal relief”. This will bring out the effect of marginal relief in the ITR form itself.
Additional disclosures of the date on which such cash donation u/s 80GGA has been made, would be required. Tax Return preparer will have to collate the same from clients appropriately.
Tax payer in whose case, the tax is deducted or payable u/s 80-IAC in respect of ESOPs, such person is not be eligible to file tax return in ITR-1 and ITR-4. Accordingly, other appropriate ITR will have to be opted.
These are not the new changes however, mentioned here for ease of recap.
ITR -1 is not available: –
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