CBDT had announced Forms for ITR 1 to 7 for FY 2022-23 in February 2023, but those were just PDF forms, wherein people could see what were the major changes in ITR forms but they could not file the same.
Now, CBDT has provided fillable Forms for ITR 1 and 4, and one can file the same on Income tax website using online or offline utility.
Last year a few conditions have been added for those who cannot file ITR 4 which are as under:
In the below mentioned cases a person won’t be allowed to file ITR 4: where person has income of the nature specified in clause (vi) of sub-section (2) of section 17 i.e. ESOP in startup on which tax is payable or deductible, as the case may be, under sub-section (2) of section 191 or sub-section (1C) of section 192; or if income-tax is deferred on ESOP.”
ITR 4 Sugam:-
ITR 4 is for the assessee who own a small business and you don’t care about maintaining books of accounts and don’t want that hassle. It is just a 6 page ITR form which you file prepare and file online on the website itself and you don’t need any utility or software for filing such return and therefore it is also known as SUGAM.
Who are eligible to file ITR 4:
Assessee Type: Individual, HUF, Partnership Firm
Type of income: Salary income, Income from one House property, Business or professional income under presumptive taxation scheme i.e. 44AD, 44ADA, 44AE i.e. small business owners, Income from other sources, Agricultural income upto Rs. 5,000 and exempt income from capital gain (but I don’t think now there is any exempt income under capital gain).
Now let’s see when you are not eligible to use ITR 4:
Assessee Type: Other than Individual, HUF and partnership firm i.e. LLP or company, also non resident individual and individual who have foreign asset or income.
Type of income: More than one House property, income from lottery or horse race, taxable income from capital gain (even if it’s loss) or business income which is not as per presumptive taxation scheme.
Some other important points: If you have any loss under house property which you wish to carry forward and set off then you need to switch to ITR 3/5. Also if your total income is above Rs. 50 lakh you can’t use ITR 4.
Earlier till the time capital gain income on long term securities was exempt you could file ITR 1 and 4 if you had such exempt income but now with such income being taxable you cant use them even if your long term capital gain from listed securities is below 1 lakh and not chargeable to tax u/s 112A.
Thus, above are the conditions which explain you about who are eligible and who are not eligible to file ITR 1 and 4.
In current year’s ITR 4 only 1 change has been made wherein assessee has been now again allowed to file income tax return against notice u/s 153C of the Act which was removed last year. We are not sure why this option has been made available as now section 153C is of no use.
Further, if we read ITR form closely we can see that in the ITR form it has been mentioned that if the income is below the percentage prescribed in section 44AD then audit u/s 44AB is mandatory. Relevant extract from the ITR is as under:
“If Income is less than the above percentage of Gross Receipts, it is mandatory to have a tax audit under 44AB & other ITR as applicable has to be filed”
However, in our opinion it should not be the case if this the first year of business of assessee or assessee has not opted for 44AD earlier.
To read more CLICK HERE: Businessman with turnover below 1 crore and having profit below 8% need to compulsorily get books of accounts audited: Let’s find out – Taxontips
Although ITR’s are available we won’t suggest anyone to start filling the ITR’s now as we have learned from previous years CBDT might make few changes in them hence we would advice you to wait till month end and then start filing ITR or if you wish to claim any TDS credit then we would recommend to wait till 15th of June for TDS credit to be available.
No major change has been made in ITR Forms but the method/ system of filing ITR form has been changed.
Also, CBDT has mentioned that it has discontinued Java utility from AY 2021-22 onwards and now assessee needs to prepare Income Tax return using common utility provided by Income tax department which generated JSON file but Excel and Java utility shall be available for earlier years.
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