STREAMLINING INCOME TAX FILING: INSIGHTS INTOREVAMPED ITR FORMS FOR FY 2023-24

In a bid to enhance efficiency and transparency, the Central Board of Direct Taxes (CBDT) has unveiled the latest Income Tax Return (ITR) forms for the fiscal year 2023-24. Set to be implemented from April 1, 2024, these updated forms, ranging from ITR 1 to ITR 6, are poised to revolutionize the income tax filing process, offering a more cohesive and transparent platform for taxpayers.

Key Highlights of the Revamped ITR Forms:

1. ITR 1 (Sahaj): Tailored for resident individuals with a total income of up to ?50 lakh, encompassing earnings from salaries, one house property, and other sources. Assessees Filing this form are now directly required to indicate their cchoice of tax rregime directly in the Return of Income.
2. Changes in ITR 2 and ITR 3: – Introduction of additional disclosure fields, including Legal Entity Identifier (LEI) number, audit report acknowledgment number, UDIN, and capital gains accounts scheme details.
   – Individuals or HUFs undergoing a tax audit can now verify their ITR using the electronic verification code (EVC), shifting away from exclusive reliance on digital signature certificates (DSCs).
3. Form 10-IEA Requirement for ITR 4 Filers: Taxpayers opting for ITR 4 must now file Form 10-IEA to opt out of the new tax regime, facilitating a seamless transition for those choosing the old regime.
4. Section 80CCH Deduction Reporting: Inclusions of a new column in both ITR 1 and 4 for reporting deductions under section 80CCH, specifically for individuals enrolled in the Agnipath Scheme and subscribing to the Agniveer Corpus Fund post-November 1, 2022.
5. Cash Turnover Disclosure in ITR 4: Introduction of a “receipts in cash” column for ITR 4 filers, enhancing transparency and compliance.
6. Enhanced Details Requirement for Companies in ITR 6: Mandates additional details in ITR 6, including LEI, MSME registration number, reasons for tax audit under section 44AB, disclosure of winnings from online games taxable under section 115BBJ, and virtual digital assets.
7. Acknowledgement Number and UDIN Requirement in ITR 6: Companies filing ITR 6 must provide acknowledgment numbers and Unique Document Identification Numbers (UDIN) for audit reports under section 44AB and section 92E.
8. LEI Requirement for Refund via ITR 6: Companies seeking refunds of ?50 crore or more must furnish the Legal Entity Identifier (LEI) as part of their filing requirements.
9. Clauses for Timely Payments to MSMEs in ITR 6: Introduction of additional clauses in ITR 6 for sums payable to micro or small enterprises, aiming to promote timely payments and compliance with the MSME Act. These comprehensive revisions aim to streamline the income tax filing process while ensuring a robust framework for disclosure and compliance. As taxpayers gear up for the upcoming fiscal year, these revamped ITR forms promise a smoother and more transparent filing experience.