We have already discussed about the various ITR which are already available to us i.e. ITR 1 to 4 and ITR 6.
In today’s post let’s discuss about ITR 5, various amendment made in ITR 5 for AY 2021-22 and who are eligible for filing the same.
Let’s first see who is eligible to use ITR 5 Form?
This Form can be used by a person being a
- Limited Liability Partnership (LLP),
- Association of Persons (AOP),
- Body of Individuals (BOI),
- Artificial Juridical Person (AJP) referred to in clause (vii) of section 2(31),
- local authority referred to in clause (vi) of section 2(31),
- representative assessee referred to in section 160(1)(iii) or (iv),
- Primary Agricultural Credit Society,
- Co‐operative Bank other than a primary agricultural credit society or a primary co‐operative agricultural and rural development bank,
- Primary Co‐ operative Agricultural and Rural Development bank,
- any other cooperative society, society registered under Societies Registration Act, 1860 or under any other law of any State, trust
- other than trusts eligible to file Form ITR‐7,
- estate of deceased person,
- estate of an insolvent,
- business trust referred to in section 139(4E),
- investments fund referred to in section 139(4F) and
- Any other AOP /BOI.
However, a person who is required to file the return of income under section 139(4A) or 139(4B) or 139(4D)shall not use this form.
Below are the Key changes in ITR 5 as compared to ITR for AY 2020‐21:
Option to avail benefit u/s 115BAD is provided in ITRs, after filing Form 10IF, for Co‐operative societies being:
o Primary Agricultural Credit Society
o Primary Co‐operative Agricultural and Rural Development bank
o Co‐operative Bank other than “a primary agricultural credit society” or “a primary co‐operative agricultural and rural development bank”
o Other Cooperative Society
For co‐operative societies opting under 115BAD, tax will be charged at 22% and surcharge will be charged at 10% from Rs.1/‐ onwards. Also, such assessee’ s are not eligible for certain deductions and allowances as mentioned below :
o Exemption u/s 10AA
o Additional depreciation under clause (iia) of sub‐section (1) of section 32
o Deduction u/s 32AD / 33AB / 33ABA
o Deduction under sub‐clause (ii) or sub‐clause (iia) or sub‐clause (iii) of sub‐ section (1) or sub‐section (2AA) of section 35
o Deduction under section 35AD
o Deduction under section 35CCC or
o Deduction under Chapter VIA except 80JJAA and 80LA(1A) incase of IFS unit.
o Any amount in brought forward losses to the extent of above deductions will not be allowed to set off and carry forward and
o Any brought forward loss to the extent of unabsorbed depreciation will be added back to the asset.
Option of Filing ITR in response to notice u/s 153A and 153C is removed from ITR as requirement to file ITR under these sections is omitted.
In AY 2020‐21 , the threshold limit for a person carrying on business was increased from one crore rupees to five crore rupees in cases where the cash receipts or payments by a business don’t exceed 5% of the such receipts or such payments, however in AY 2021‐22 , the limit of five crore rupees is increased to ten crore rupees
The existing restriction of 17 codes in Nature of business/profession schedule is removed.
Loss (negative value) under “No books of account” at sl.no.65 in Sch P&L is restricted.
In schedule BP, Income/ receipts credited to profit and loss account considered under head “other sources” has been bifurcated into 2 parts as
o “Dividend income” and
o “Other than dividend income”
All the fields related to 115B – Income Life insurance Business i.e.,
o sl.no.4b, Sl.no.Table E “Computation of income from life insurance business referred to in section 115B ” of Schedule BP,
o Sl.no.iv of Sch CYLA, Sl.no.iii of Schedule BFLA,
o Col 8 of Schedule CFL and
o sl.no.12 of Schedule SI have been removed. And corresponding mapping has been updated in Part B‐TI
Section 44BBB is removed from Sl.no.4a and sl.no.36 of Schedule BP
In Schedule DPM, the column “3a.Amount as adjusted on account of opting for taxation section 115BAD” and “3b. Adjusted Written down value on the first day of previous year (3) + (3a)” has been added . Hence corresponding mapping changes are made in schedule DPM
CBDT vide notification dated 20th September 2019 increased depreciation to 45% on motor cars, motor buses etc wrt assets purchased on or after the 23rd day of August, 2019 but before the 1st day of April, 2020 and is put to use before the 1st day of April, 2020. Therefore, no additions will be allowed in 45% block from the AY 2021‐22 w.r.t to such assets.
In Schedule CG, the allowable difference between full value of consideration u/s. 50 C and value of property as per stamp authority has been increased from 1.05 times to 1.10 times.
In schedule OS,
(i) The existing drop related to “Dividend income” is bifurcated into 2 parts i.e
“Dividend income [other than (ii)]” and “Dividend income u/s 2(22)(e)” and respective changes are done in sl.no.2e _DTAA field and in sl.no.10(i)_Quarterly breakup of Dividend income.
(ii) Dividend will now be taxable from Rs.1/‐ as the section 115BBDA is omitted. Accordingly Interest expenditure u/s 57(1) to earn Dividend can be claimed at sl.no.3.
(iii) The existing drop down at Sl. No. 2d “115AD(1)(i)‐ Income received by an FII in respect of securities (other than units referred to in section115AB)” bifurcated into 2 drop downs as under:‐
115AD(1)(i)‐Income being Dividend received by an FII in respect of securities (other than units referred to in section115AB) @20%
115AD(1)(i)‐Income being other than dividend income received by an FII in respect of securities (other than units referred to in section115AB) @20%
(iv) Further new drop downs are inserted in sl. No. 2d and Sl. No. 2e wrt “Interest referred to in section 194LC(1)” and Distributed income being Dividend referred to in section 194LBA
(v) Section 115BBDA is removed from AY 2021‐22 onwards hence corresponding drop downs are removed from sl. No. 2c, 2d and 2e of schedule OS and respective changes are done in sl.no.10(i)_Quarterly breakup of Dividend income.
(vi) In existing Sl. No. 10 “Information about accrual/receipt of income from Other Sources”
Field “Dividend Income u/s 115BBDA” is changed to “Dividend income” due to finance Act changes
New line item is inserted to capture the quarter wise break up of “Dividend income which is taxable at DTAA Rates”. This information will be used to calculate interest u/s 234C.
In Schedule CFL, the bifurcation of PTI loss and other than PTI loss has been removed from “HP loss”, “Short term capital loss” and “Long term capital Loss” also corresponding changes mapping /other changes are made in field “Loss distributed among the unit holder”
In Schedule CFL, the column “5b. Amount as adjusted on account of opting for taxation under section 115BAD” and “5c. Brought forward Business loss available for set off during the year” has been added . Hence corresponding mapping changes are made in schedule CFL
In Schedule CFL, fields “Current year loss distributed among the unit‐holder (Applicable for Investment fund only)” has been added and corresponding changes done in CFL. Also, field “Loss distributed among the unit holder (Applicable for Investment Fund only)” is deleted as it has no relevance.
In Schedule UD, “Amount as adjusted on account of opting for taxation under section 115BAD” field has been added as an adjustment for 115BAD and so only balance loss can set off against income in Schedule BFLA.
In Schedule 80GGA, w.e.f. 01.06.2020, the eligible limit of Donation in cash is changed from Rs. 10,000 to Rs. 2,000. Hence date field is inserted to capture date of donation in cash.
In schedule 80IB , the deductions claimed in following sections are removed due to sunset clause and corresponding maping changes are made in schedule VI‐A
(i) Deduction in respect of industrial undertaking located in industrially backward states specified in Eighth Schedule [Section 80‐IB(4)]
(ii) Deduction in respect of industrial undertaking located in industrially backward districts [Section 80‐IB(5)]
(iii) Deduction in the case of an undertaking operating a cold chain facility [Section 80‐IB(11)]
In Schedule EI, field for “Dividend Income” is removed from exempt income as for AY 2021‐22 onwards dividend income will be taxable in the hands of shareholders. similarly corresponding Changes are also made in schedule OS , schedule Pass Through Income (PTI) to remove reference of section 115O
In schedule TPSA, dropdown for the financial year (FY 2019‐20 or FY 2020‐21) for which option u/s 92CE(2A) is exercised in AY 2021‐22 is inserted
Schedule DI (Details of Investment) has been removed as it was relevant only for AY 20‐21
In Schedule Part B TI “Sl. No.11b” Part C deductions claimed under chapter VI‐A , restriction of ii5 of BFLA is removed due to deduction claimed u/s 80P
Now, assessee needs to disclose surcharge before “Marginal Relief” and after “Marginal relief” in Schedule Part BTTI.
In Schedule TDS, earlier TDS credit is allowed only if corresponding income is being offered for tax this year , however exception is being added for TDS u/s 194N. Also the label is amended to include form 16D for the claim of TDS
Annexure 2 is inserted in instructions wrt ITR fields which should be tallied with corresponding amount mentioned in Tax Audit report i.e Form 3CA‐3CD/3CB‐3CD, if applicable.
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