Income tax return for the assessment year 2013-14

Ministry of Finance has come up with many changes with regard to filing Income Tax Return for the Assessment year 2013-14 relating to the financial year 2012-13. Before discussing about the recent changes made in the details to be given in the Income Tax Return forms let us check out the most important thing i.e., selection of the Income Tax Return Forms. Finance Minister has changed certain norms in selecting ITR forms. These are as follows-
ITR-1 Form: -
SAHAJ or the newly ITR–1, has replaced SARAL Income tax return. The main motive behind this is to simplify the existing return forms to reduce return filing burden on the Individuals.

Who can use the ITR-1 Form?
ITR–1 Form is to be used by an Individual having income from following sources:

• Income from Salary/ Pension
• Income from One House Property (not being brought forward losses from previous years)
• Income from Other Sources (not being income from lottery or race horses)

Moreover, in case any income of spouse, minor child, etc. gets clubbed with the income of the assessee, then ITR–1 can be used only if the clubbed income falls into the above income source.
Who cannot use the ITR–1 Form?
ITR–1 Form should not be used by an Individual if his total income consists of:

• Income from more than one house property
• Income from Winnings from lottery or income from Race horses
• Income ( not exempt from tax) under Capital Gains
• Income exceeding Rs. 5,000 from agricultural business
• Income from Business or Profession
• Income from stock & equity mutual funds
• Losses which has to be carried forward
• Person claiming relief of foreign tax paid under section 90, 90A or 91
• An individual who is a resident having assets (including financial interest in any entity) located outside India or signing authority in any account located outside India.

ITR-2 Form:-
The Income Tax Department has provided various Income Tax Forms for the assessees in order to file their return forms beneficially. The filing of return Forms depends upon the income earned by an assessee. The detailed features of ITR 2 explaining its applicability is mentioned below:
Who can use the ITR-2?
ITR 2 is used by an individual or a Hindu Undivided Family whose total income comprises following income:

1. Income from Salary / Pension
2. Income from House Property
3. Income from Capital Gains
4. Income from Other Sources (including income from Winning from Lottery and Race Horses)

Moreover, if the income of spouse, minor child, etc. is to be clubbed with the income of the assessee, then ITR 2 can be used if such income falls in any of the above categories.
Who cannot use the ITR-2?
ITR 2 is not used by

1. An Individual/ HUFs if his total income includes any income taxable under the head “Profit or Gain from Business or Profession. In other words, business or professional income does not form the part of ITR-2.
2. The person already using ITR-1 Form.
3. A Partnership Firm having exempt income by way of shares (& not earning any income by way of interest, salary, etc.).

ITR-3 Form:-
Income Tax returns filing has to be done in Income Tax Forms which is provided by the IT Department and applicable to assessee according to the income earned. Now-a-days the process of filing is too easy and hassle free for the assessees. A detailed view has been given about ITR-3 Form.
Who can use the ITR-3?
A person being an Individual or HUFs who is a partner in a firm is required to use ITR-3 form whose income chargeable to income-tax under the head “Profits or gains of business or profession” should not include any income except the income stated below:

• Interest
• Salary
• Bonus
• Commission or
• Remuneration

By whatever name called, due to, or received by Individual or HUF from such firm.
ITR-4 Form:-
Income tax return is filed through ITR form which is based on the income earned by an assessee. Most individuals are confused about which ITR form they should use for filing their income tax return. Here is a brief discussion on ITR-4 and ITR-4S & its applicability.
Who can use the ITR-4?
ITR-4 Form is used by an Individual or HUF who is carrying out a proprietary business or profession and who are not filing Return under Presumptive Taxation Scheme. The following income can be included in ITR-4 form:

• Income from Salary/Pension
• Income or Losses from House property
• Income from Business Profession
• Income or Losses from Capital gains
• Income or Losses from Other Sources

Moreover, every Partnership firms, Individuals & HUF having their tax audits mandatorily u/s 44AB is required to file their ITR-4 Electronically using digital signature.
Who cannot use the ITR-4?
An Individual or a HUF computing business income from Presumptive Taxation Scheme are not eligible to file ITR-4. For Presumptive Business Income, an assessee files ITR-4S (SUGAM).
ITR-4S FORM:-
For Presumptive Business Income an assessee needs to file his return using ITR-4S Form (commonly known as SUGAM).
Who can use the ITR-4S?
ITR-4S Form is applicable on Individuals, HUFs & small business taxpayers deriving income from

• Business income where Presumptive scheme under section 44AD & 44AE of the Act is used for computation of business Income
• Salary/Pension
• One House Property
• Other Sources

Moreover, in case any income of spouse, minor child, etc. gets clubbed with the income of the assessee, then ITR-4S can be used only if the clubbed income falls into the above income source. Also, the above income will be deemed to be computed after considering every losses, allowances, depreciation, etc.
Who cannot use the ITR-4S?
ITR-4S is not applicable if income is derived from

• More than one House Property
• Winning from lotteries/horse races
• Capital gains not exempt from tax
• Agricultural Business in excess of Rs. 5000
• Speculative Business
• Losses to be carried forward

Return in ITR-4S cannot be filed by a person, who:
a) Is a resident Individual or a HUF (other than not ordinarily resident in India) deriving income as referred to in section 44AD or 44AE, and has:

• Any asset (including financial interest) located outside India;
• Signing authority in any account located outside India;

b) Has claimed any relief of tax under section 90, 90A or 91;
c) Has income exceeding Rs. 5,000 which is not chargeable to tax. In other words, if assessee claims exemption in respect of any income under sections 10, 10A, 10AA, etc.
ITR-5 Form:-
Who can use ITR 5?

• The form can be used by a person being a -
• Firm
• AOPs (Association of persons),
• BOIs (Body of individuals)
• Any other person

Who cannot use ITR 5?

• The form should not be used by a person being an-
• Individual
• HUFs
• Company
• And to those persons to whom ITR-7 is being applicable.

ITR-6 Form:-
ITR-6 can be used by a company, other than a company claiming exemption under section 11.
ITR-7 Form:-
ITR 7 Form can be used by persons including companies who are required to furnish return under

• Section 139(4A) : Filing return by charitable/Religious trust
• Section 139(4B) : Filing return by political party
• Section 139(4C) : Filing return by certain Institutions
• Section 139(4D) : Filing return by Scientific Research University

Changes in the details to be given in the Income Tax Return Form for the AY 2013-14 relating to the Financial year 2012-13:-
Assessment Year 2013-2014 will be influenced by some very important amendments which have been made in the Income-tax Rules with reference to filing of Income-tax Return. This article is intended to elaborate the fact that Income Tax Return for AY 2013-14 will be different, and that too, in a considerable manner. These are given as follows-
1) Tax Audit Report Details: The filing of audit reports was made mandatory in ITR Form 5, 6 and 7 after the tax department noticed discrepancies in filing of some returns along with audit reports. The Institute of Chartered Accounts of India brought to the notice of the I-T department that some companies were furnishing fake name and registration numbers of auditors in their returns.
2) Loss from Other Sources: It is specifically mentioned in the new amendment that persons taking advantage of filing Income-tax Return in the SAHAJ Form (ITR-1) should not have any loss under the head Income from Other Sources. If assessee has such loss then he can use ITR-4.
3) DTAA relief: The SAHAJ Income-tax Return form also cannot be used by an individual claiming any double taxation tax relief under sections 90 or 90 A or 91 of the Income-tax Act, 1961.
4) IT PAYABLE <Rs.5,000: The new amendment also comes with the stipulation that whose income tax payable is less than Rs. 5,000, he cannot file ITR-1(SaHAJ) Form.
5) E-filing Mandatory: This is a real important new amendment whereby it is now compulsory for persons having income in excess of Rs. 5 lakhs for the Assessment Year 2013-14 to file their Income-tax Return in the Electronic Form. However, the charitable trusts and educational institutions etc. that are required to file their Income-tax Return in Form No 7 will not be compulsorily required to file the Return electronically irrespective of their income.
6) Details of Assets & Liabilities: The most important amendment with reference to filing Income-tax Return is with reference to a new “Schedule AL” which is introduced in ITR 3 & ITR 4. This schedule contains details of Assets & liabilities of an individual or HUF. This schedule is to be filled up when the income of the individual or HUF exceeds Rs. 25 lakhs.
7) Electronic submission of Audit Report: It is well known fact that tax payers are not required enclosing any papers or documents with their Income-tax Return. However, the new amendment provides that where the assessee is required to furnish a report of Audit as per section 115AB or 92E or 115JB of the Income-tax Act, 1961, then such audit report shall be furnished electronically with the Income-tax Return.
Conclusion: The tax payers in particular who are having income in excess of Rs. 5 lakhs for the Assessment Year 2013-14 in particular to carefully understand the new provisions relating to filing of the Income-tax Return Form whereby it has been now compulsory for them to file their Income-tax Return electronically. Likewise persons who are having tax audit should also not forget to submit the audit report with the Income-tax Return electronically. The Income tax Return forms which are required to be filled in for the AY 2013-14 are basically almost at par with the Income-tax Return Form as was being used in the previous years. All assets abroad and all incomes abroad are required to be mentioned in the Income-tax Return.
It may be noted that the impact of amendments in Rule 12 of the Income-tax Act would now mean that if an individual is having exempted income in excess of Rs. 5,000, in that situation such individual will not be able to file the Income-tax Return SAHAJ (ITR 1). For example let us say a salaried employee has got income from salary income and some bank interest income. But if he has got dividend income of Rs. 10,000, in that situation he will not be able to file the Income-tax Return in Form SAHAJ (ITR1) because the new amendment specifically mentions that the Return Form SAHAJ cannot be used by an individual having income not chargeable to tax exceeding Rs. 5,000. Such persons have to file the Return in Form No. 2. Similarly an individual or a Hindu Undivided Family carrying on business having turnover less than Rs. 1 crore and normally required to file the Return in Form SUGAM (ITR4S) will not be able to file the Return in the said SUGAM Form for the AY 2013-14 if he were to have exempted income say like dividend, interest income or income from Mutual Fund or income from Tax Free Bond exceeding the sum of Rs. 5,000. Hence, all individuals and Hindu Undivided Families in particular carrying on business and computing income on presumptive basis and also having income not chargeable to tax exceeding the sum of Rs. 5,000, cannot use the Income-tax Return Form SUGAM and will, therefore, be required to file the Return in Form No. 4. Persons filing ITR 3 & ITR 4 and having income in excess of Rs. 25 lakhs should carefully fill up “Schedule AL” to give details of assets & liabilities.
Please take care of the above mentioned important new amendments to the Income-tax Rules relating to filing of Income-tax Return and thereafter file your Income-tax Return correctly in the correct applicable form depending upon your facts and circumstances and also do not forget to file the Income-tax Return in the specific mode which is required in terms of the provisions contained in the Income-tax Law