Income Tax return for FY 2020-21 were announced, however till date only ITR 1 to 4 were available for filing. Now ITR 6 is also available for filing on e filing website.
So, let’s have a look on what are some important amendments in ITR 6 and who are eligible to file the same.
First of all ITR 6 is the only income tax return available for all the companies except those eligible for ITR 7. [If you need assistance of Chartered Accountant in filing your Income tax return you can get the same by clicking on the link at the end of the post]
Let’s first see who are eligible to file ITR 6 Form:
This Return Form can be used by a company as per section 2(17) of the Income Tax Act. This form is filed by company other than a company which is required to file return in Form ITR‐7.
As per section 2(17) of Income Tax Act, company means: ‐
(i) Indian Company (Domestic Company)
(ii) Body corporate incorporated by or under the laws of country outside India
(iii) Any institution, association or body, whether incorporated or not & whether Indian or Non‐Indian which is declared by general or special order of the board to be company, etc.
Manner of filing this Return Form
This Return Form can be filed with the Income‐tax Department electronically on the e‐filing web portal of Income‐tax Department (www.incometaxindiaefiling.gov.in) [www.incometax.gov.in from 7‐June‐2021] and verified by way of digital signature only.
Key changes (as compared to ITR for AY 2020‐21)
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 case of domestic company, the rate of income‐tax shall be twenty five per cent of the total income, if the total turnover or gross receipts of the previous year 2017‐18 does not exceed four hundred crore rupees. For AY 2021‐22 the previous year 2017‐18 is changed to 2018‐19.
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 3 codes in Nature of business/profession schedule is removed.
In schedule P & L Account at Sl. No. 62 , the form has been enabled to capture section wise profits u/s 44B, 44BB, 44BBA and 44BBB.
In schedule BP, Income/ receipts credited to profit and loss account considered Instructions to Form ITR-6 (A.Y. 2021-22) under head “other sources” has been bifurcated into 2 parts as “Dividend
income” and “Other than dividend income”.
In Schedule BP, Table E “Computation of income from life insurance business referred to in section 115B ” has been removed in Schedule BP. And corresponding mapping has been updated in schedule CYLA and Part B‐TI.
In Schedule DPM, the column “3a. Amount as adjusted on account of opting for taxation section 115BA” and “3b. Adjusted Written down value on the first day of previous year (3) + (3a)” has been removed . 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 w.r.t. 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 in 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)”
(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 w.r.t. “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. 2d and 2e of schedule OS.
(vi) In existing Sl. No. 10 “Information about accrual/receipt of income from Other Sources”
(a) Field “Dividend Income u/s 115BBDA” is changed to “Dividend income” due to finance Act changes
(b) one more 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 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 Instructions to Form ITR-6 (A.Y. 2021-22) of donation in cash
In schedule 80IB , the deductions claimed in following sections are removed due to sunset clause and corresponding mapping 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 VI A, under part C new deduction is inserted “Section 80M (Intercorporate dividend) for Domestic Company
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 DDT (Details of tax on distributed profits of domestic companies) has been removed as form AY 2021‐22 onwards companies are not required to pay dividend distribution tax u/s 115O.
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 80M
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 w.r.t. 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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