ITR Filing Form for AY 2023-24: The Income Tax Department has released JSON Schema for ITR 1, ITR 2, ITR 3 and ITR 4 for the Assessment Year 2023-24 (Financial Year 2022-23). This means taxpayers can start preparing to file their returns as soon as the e-filing portal is opened, which is expected to be in the last week of April or May first week. However, salaried individuals might have to wait until mid-June, as employers are expected to generate Form 16 for Assessment Year 2023-24 around that time.
What does Income Tax Return (ITR) mean?
For those unfamiliar with ITRs, an Income Tax Return (ITR) is a document that taxpayers use to report information about the income they have earned and the applicable taxes to the income tax department. The income tax department has notified seven different forms, namely ITR-1, ITR-2, ITR-3, ITR-4, ITR-5, ITR-6 and ITR-7.
Taxpayers must file their ITR on or before the specified due date. The type of ITR form that a taxpayer needs to file depends on their sources of income, the amount of income earned, and their taxpayer category, such as individuals, HUF, company, etc. It is important to file these forms on time and provide accurate information to avoid any penalties or legal consequences.
To help taxpayers understand which ITR form to use, here’s a guide:
Who can use ITR-1 Form?
ITR Filing form ITR-1 is a type of Income Tax Return Form used by a resident individual in India, whose total income for the year includes the following:
- Income from salary/pension.
- Income from one house property (excluding cases where losses are brought forward from previous years).
- Income from other sources (excluding winnings from lottery and income from race horses).
- Agricultural income up to Rs 5000.
- Individuals with income from business or profession or capital gains cannot use this form.
Who cannot use ITR-1 Form?
- Total income exceeding Rs. 50 lakh
- Agricultural income exceeding Rs. 5000
- Taxable capital gains Income from business or profession
- Income from more than one house property
- Director in a company Investments in unlisted equity shares at any time during the financial year
- Ownership of assets (including financial interest in any entity) outside India, including signing authority in any account located outside India
- Resident not ordinarily resident (RNOR) and non-resident
- Foreign income
- Assessable in respect of income of another person in respect of which tax is deducted in the hands of the other person
- Tax deducted under Section 194N
- Payment or deduction of tax deferred on ESOP Brought forward loss or loss needs to be carried forward under any income head
Who can use Form ITR-2?
ITR-2 is a tax return form that can be used by individuals or Hindu Undivided Families (HUFs) whose total income for the AY 2023-24 includes the following:
- Income from Salary/Pension
- Income from House Property
- Income from Other Sources (including Winnings from Lottery and Income from Race Horses)
- If you are an Individual Director in a company
- If you have had investments in unlisted equity shares at any time during the financial year
- Being a resident not ordinarily resident (RNOR) and non-resident
- Income from Capital Gains
- Having any foreign income
- Agricultural income more than Rs 5,000
- Owning assets (including financial interest in any entity) outside India, including signing authority in any account located outside India
- If tax has been deducted under Section 194N
- If in case payment or deduction of tax has been deferred on ESOP
- If you have any brought forward loss or loss needs to be carried forward under any income head
- Additionally, this form can also be used if the income of another person such as spouse or child is to be clubbed with the assessee’s income, and if such income falls in any of the above categories.
- The total income can be more than Rs 50 Lakhs.
Who can file ITR-3 Form?
If you’re an individual or a Hindu Undivided Family (HUF) who has income from a proprietary business or profession, you need to file ITR-3 Form.
- This includes income from carrying on a business or profession, being an individual director in a company, or having invested in unlisted equity shares during the financial year.
- In addition to this, ITR-3 can also be filed if you have income from House property, Salary/Pension, or Income from other sources.
- If you’re a partner in a firm or not eligible to file ITR-1, ITR-2, and ITR-4, then ITR-3 is the appropriate form for you.
- It’s important to note that there have been some changes to the ITR-3 Form. A new schedule VDA has been added to separately report income from crypto/other VDAs. This means that every VDA transaction needs to be reported along with the sale and purchase dates.
- Additionally, new questions have been added to determine if you had opted out of the New Tax Regime in previous years.
- If you’re a foreign institutional investor (FII/FPI), you need to provide your SEBI registration number as an additional disclosure measure.
- Finally, it’s important to report all advances received from individuals specified in Sec 40A(2)(b) of the Income Tax Act and others under the ‘Advances’ heading in Source of Funds.
- Turnover and income from intraday trading must be reported under the newly introduced section ‘Trading Account’.
Who can use ITR-4 Form?
ITR-4 Form, also known as Sugam, is designed for individuals, Hindu Undivided Families (HUFs) and Partnership Firms (other than LLP) having a total income of up to Rs 50 lakhs in a financial year and who have income from business or profession. The following taxpayers can use ITR filing form ITR-4 for the Assessment Year 2023-24:
- Resident individuals or HUFs who are eligible to file ITR-4 and have income from a business or profession, where such income is computed under the presumptive taxation scheme.
- Professionals with gross receipts of up to Rs 50 lakhs who opt for presumptive taxation under Section 44ADA.
- Persons with income from the newly introduced specified profession(s) under Section 44ADA, such as legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration or any other notified profession, with gross receipts of up to Rs 50 lakhs.
- Persons with income from a business where they have opted for the presumptive taxation scheme under Section 44AD with a total turnover or gross receipts of up to Rs 2 crores.
- Persons with income from a business where they have opted for the presumptive taxation scheme under Section 44AE with up to 10 vehicles.
- Persons who are eligible to file their income tax returns under Section 44BB or 44BBB, i.e., income from exploration of mineral oils or income from business of civil construction, respectively.
- Budget 2023 has amended Sec 44AD and Sec 44ADA to revise presumptive taxation limits for FY 2023-24 (AY 2024-25) as follows:
|Limits till FY 2022-23
|Sec 44AD for small businesses
|Rs 2 crores
|Rs 3 crore
|Sec 44ADA: For professionals like Accountants, doctors, lawyers, engineers, etc
|Rs 50 Lakhs
|Rs 75 Lakhs
.Who cannot use ITR-4 Form?
- If their total income exceeds Rs 50 lakh
- If they have income from more than one house property
- If they own any foreign asset If they have signing authority in any account located outside India
- If they have income from any source outside India
- If they are a Director in a company
- If they have had investments in unlisted equity shares at any time during the financial year
- If they are a resident not ordinarily resident (RNOR) and non-resident
- If they have foreign income
- If they are assessable in respect of the income of another person in respect of which tax is deducted in the hands of the other person.
- If payment or deduction of tax has been deferred on ESOP
- If they have any brought forward loss or loss needs to be carried forward under any income head
- Persons with income from commission or brokerage.
Who should use ITR-5 Form?
- ITR-5 form is used as ITR filing form by entities such as firms, LLPs, AOPs, BOIs, AJPs, estates of deceased or insolvent persons, business trusts, and investment funds.
- However, a person who is required to file the return of income under section 139(4A) or 139(4B) or 139(4C) or 139(4D) shall not use this form.
Who can use ITR filing form ITR-6?
Companies that are not claiming exemption under section 11 (Income from property held for charitable or religious purposes) are required to file their return electronically only. This means that paper filing of returns is not allowed for these companies.
Who can use ITR filing Form 7?
ITR 7 is a tax return form that needs to be filed by persons and companies required to furnish returns under various sections of the Income Tax Act. These include:
- Section 139(4A): Persons in receipt of income derived from property held under trust or other legal obligation wholly for charitable or religious purposes or in part only for such purposes.
- Section 139(4B): Political parties whose total income exceeds the maximum amount not chargeable to income tax.
- Section 139(4C): Scientific research associations, news agencies, associations or institutions referred to in section 10(23A), institutions referred to in section 10(23B), funds, universities, educational institutions, hospitals, and medical institutions.
- Section 139(4D): Universities, colleges or other institutions not required to furnish a return of income or loss under any other provision of this section.
- Section 139(4E): Business trusts not required to furnish a return of income or loss under any other provisions of this section.
- Section 139(4F): Investment funds referred to in section 115UB not required to furnish a return of income or loss under any other provisions of this section.
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