I-T returns: Stern scrutiny of taxpayers from this year

CHENNAI: THE Central Board of Direct Taxes (CBDT) has notified the new income tax return (ITR) forms which seek details about allowances of salaried persons among others. The new form, which comes with several new columns, seeks to ‘mine’ the GST payments of businesses to ensure that no income go untaxed.  It reflects the trend of revenue authorities increasingly using digital tax data gathering and its analysis to assess taxpayers.

ITR 1 or Sahaj is the most commonly used form. According to the taxman, this form benefited around three crore taxpayers for the assessment year 2017-18. However, its use is restricted to ordinary residents with an income up to Rs 50 lakh from salary, one house property/other income.

Tax payers will now have to provide the break up of salary including taxable allowances, value of perquisites and deduction for professional tax. Details of income from house property such as gross rent received and tax paid on property are also a must.

It means that Non-Resident Indians (NRIs) will have to now use the ITR-2 or ITR-3. Further, the need for furnishing details of at least one foreign bank account is provided for the purpose of credit refund. It must be noted that if there is a delay in filing return (i.e. after the due date of July 31, 2018), taxpayers will be liable to a fee of Rs 5,000. This fee is payable under Section 234F, which has to be specified in the form.
The detailed break up of salary, which was not part of the ITR forms last year, is added for clarity of deductions. It will also give a better picture of how income from these heads is computed.

Whether it is mandatory or not to fill the break-up fields will be clarified when the scheme utility is released. The new forms require the tenant PAN to be furnished (in the TDS Schedule) by landlords, since individual tenants paying rent  in excess of Rs 50,000 are required to deduct tax at source from FY ’17-18 onwards.

The new set of forms mandates small businesses and those paying tax under the government’s presumptive taxation scheme to report their Goods and Services Tax Identification Number (GSTIN) and turnover reported under the new tax regime.

ClearTax founder & CEO Archit Gupta says most of the changes in the ITR forms are made more in line with and to accommodate the various amendments brought in the Union Budget 2017.

“Presumptive taxpayers, who generally report a percentage of their turnover as their income and can get away without maintaining books, have an additional compliance going forward in terms of reporting their GST number, turnover etc,” the tax expert says.