Income Tax return for FY 2022-23 were announced, however till date only ITR 1, 2 and 4 were available for filing. Now ITR 3 is also available for filing on e-filing website.
So, let’s have a look on what are some important amendments in ITR 3 and who are eligible to file the same.
First of all ITR 3 is the biggest and exhaustive return as far as Individual and HUF is concerned. Any type of income can be shown in ITR 3 and there are no restriction in ITR 3 as we see in ITR 1, 2 and 4.
Let’s first see who are eligible to file ITR 3 Form:
The heading of ITR 3 read as under: “For individuals and HUFs having income from profits and gains of business or profession”, but as mentioned above it is the most exhaustive return.
Also, people are confused whether one can declare income under 44AD or 44ADA and file return under ITR 3? The answer is yes. We have discussed about the same in our post on Myths about Income Tax return busted. To read the same CLICK HERE: TOP Myths relating to Income Tax return….Busted – Taxontips. Also any person who is a partner in any firm has to file ITR 3.
Hence, this Return Form is to be used by an individual or a Hindu Undivided Family who is having income under the head “profits or gains of business or profession” and who is not eligible to file Form ITR‐1 (Sahaj), ITR‐2 or ITR‐4 (Sugam).
Below are the major amendments in ITR 3:
Return can be filed in response to notice u/s 153C. So, section 153C has been added in Part A General
➢ 115BAC New regime labels have been modified and opt out new field has been added as mentioned below.
a. Have you ever opted for new tax regime u/s 115BAC in earlier years Yes/No -Label Modified
b. Have you ever opted out of section 115BAC in earlier years? Yes/No (If Yes is selected, please furnish the AY in which said option is opted out along with date of filing and Acknowledgement number of form 10-IE) – New Field added
c. Option for current assessment year Opting in now Not opting Continue to opt Opt out Not eligible to opt in (Select “Opting in now” only if you are opting in first time) – “Not eligible to opt in” has been added
➢ New field related FII/FPI has been added
Whether you are an FII / FPI? Yes/No . if Yes is selected SEBI Regn. Number should be provided
➢ Balance Sheet
Details relating to advances need to be provided in Sl.no 4 of Sources of Funds. Advances received from persons specified u/s 40A(2)(b) and from others need to be provided.
➢ In Schedule salary under Gross salary one new field “Income taxable during the previous year on which relief u/s 89A was claimed in any earlier previous year“ has been added at Sl.no 1f. Similar field has also been added in Sl.no 1e of Schedule OS.
➢ In Part A – Trading Account, two new fields have been added to capture the details of Turnover and income from Intraday Trading.
➢ As per the Finance Act, 2022, a new section 115BBH has been inserted in the Act to provide where the total income of an assessee includes any income from the transfer of any virtual digital asset, the income-tax payable shall be the aggregate of as below:
1. The amount of income-tax calculated on the income from transfer of such virtual digital asset at the rate of 30% &
2. The amount of income-tax with which the assessee would have been chargeable, had the total income of the assessee been reduced by the income referred to in clause (a)
Section 115BBH changes have been incorporated in Schedule BP, Schedule CG and Schedule SI and New Schedule VDA has also been Inserted.
➢ In Schedule VDA assessee is required to provide details of date of acquisition and cost, date of transfer and consideration, head of income, Income from transfer of Virtual digital assets. Income from virtual digital asset will be auto populated in Schedule BP and Schedule CG
➢ In Schedule 80G, in table D “Donations entitled for 50% deduction subject to qualifying limit” field has been inserted to capture the details of ARN (Donation Reference Number) of form 10BD.
➢ Schedule 80IB
Deduction in respect of Industrial undertaking located in Jammu & Kashmir or Ladakh has been removed due to Sunset clause.
➢ As per Budget 80CCH deduction has been added in Chapter VI-A for providing deduction for the contribution made to Agni path scheme 2022
➢ Schedule TCS has been updated to claim the TCS credit of other person [spouse as per section 5A/ other person as per rule 37i(1)]
Disclaimer: The views presented in the above article are personal views of our team and has no legal binding. For any legal opinion consult a tax professional.
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