ITR AY 2020-21 CHANGES/ READY RECKONER

Dated: June 14, 2020
Editorial No. 02

This article is bifurcated into four parts and is updated for the ITR of AY 2020-21.

Part A: Person liable to file return as per section 139

Part B: Due date to file return

Part C: Brief of Rule 12 and which return to be filed

Part D: Changes in ITR forms

Part A: Person liable to file return as per section 139

1. Company (any)
2. Firm
3. Resident and ordinarily resident, if:-

(a)   Holds, any asset o/s India

(b)   Any financial interest in entity o/s India

(c)   Signing authority in any account o/s India

1. If total income, before Section 10(38), 10A, 10B, 10BA, 54, 54B, 54D, 54EC, 54F, 54G, 54GA, 54GB and Chapter VIA deductions, exceeds maximum amount not chargeable to tax.
2. If total income, of other person of which he is assessable, before Section 10(38), 10A, 10B, 10BA, 54, 54B, 54D, 54EC, 54F, 54G, 54GA, 54GB and Chapter VIA deductions, exceeds maximum amount not chargeable to tax.
3. Seventh proviso to section 139(1):

• Deposited > 1 Crore in one or more current accounts maintained with a banking company or a co-operative bank or
• > 2 Lakhs expended for himself or other person for travel to a foreign country or
• > 1 lakhs incurred as expenditure towards consumption of electricity.

1. If gross receipts of charitable trust and institutions exceeds limit before exemption under section 11 and 12.
2. Chief executive officer of Political party if total income before section 13A exceeds the limit.
3. Special entities, like research association, news agency, 10(23A) institutions, etc. before giving exemption under section 10.

10.  University, college or other institution referred to in clause (ii) and clause (iii) of sub-section (1) of section 35

11.  Business trust

12.  Every investment fund referred to in section 115UB

Note: Highlighted and underlined text inserted in Finance Act 2019 for AY 2020-21.

Part B: Due date to file return

1. Upto 31st October (Previously 30th September) of AY in case of:-

(a)   Company

(b)   Person where accounts are required to be audited under this act or other law.

(c)   Partner of firm whose accounts are required to be audited. (Previously Working partner)

1. Upto 30 Nov of AY in case where assessee is required to furnish a report in section 92E (Transfer pricing).

1. Upto 31 July of AY in other cases

Notes:

1. Highlighted and underlined text inserted/modified in Finance Act 2019 for AY 2020-21.
2. Due to COVID 19, all the above dates has been extended to 30th November for AY 2020-21.

Part C: Brief of Rule 12 and which return to be filed

Part D: Changes in ITR forms

1. Law related consequential changes:-

1. (ITR 1 to 6) As time limit to invest/deposit/payments etc. for claiming deduction/exemption for the FY 2019-20 has been extended to 30/06/2020. In consequence thereof, New ‘Schedule DI' inserted for furnishing details of amount paid/ investment made during 01/04/2020 to 30/06/2020 for claiming deduction in AY 2020-21.

Part A: Chapter VIA deductions

Part B: Deduction u/s 10AA

Part C: Exemption u/s 54 to 54GB

1. (ITR 1 to 7) Option to quote PAN or Aadhaar in many schedules. Like TDS details, Details of tenant of house property, Auditor details, details of Co-owner of house property, details of person verifying the return etc.

1. (ITR 2,3,5) Separate reporting of surcharge on income chargeable to tax under sections 112A, 111A, proviso to section 115AD(1)(b)(iii). As rate of surcharge (25% or 37%) withdrawn for Individual, HUF, AOP/BOI, AJP and maximum surcharge rate is 15%.

1. (ITR 3,5,6) Reporting of cash receipt or payment where turnover of assessee is between Rs. 1 crore to Rs. 5 crore. As turnover required for audit has been increased from Rs. 1 crore to 5 crore subject to condition that cash expenses and cash receipts does not exceeds 5%, therefore separate reporting of the same is asked for.

1. (ITR 6) Separate Reporting of dividend received from the specified foreign company:- As per section 115BBD of the Income-tax Act, dividend received by a domestic company from a foreign company, in which such domestic company has 26% or more equity shareholding, is taxable at a special rate of 15% plus Surcharge and Cess.

1. (ITR 6) Foreign company to separately report income from royalty or Fees for technical services chargeable to tax @ 50%. Changes made in Schedule OS and Schedule SI.

1. (ITR 7) Trust to furnish details of re-registration made under the new provisions. Details relating to re-registration under new provisions shall be filled only if application for registration under new provisions has been filed before filing ITR.

Additional details to be filled are: Section under which the registration is applied, date on which application is made, section of exemption opted for under the new provisions.

1. (ITR 7) Corpus donation not to be considered as an application of Income. ITR Form 7 seeks ‘Donation-other than corpus’ as against the classification of donation required until last year into ‘corpus’ and ‘other than corpus’. Along with, Part C of Schedule ER has been amended to incorporate the Donation forming part of corpus fund as disallowable expenditure.

1. (ITR 3,5 and 6) Depreciation rate of 45% added in the block of plant and machinery for motor vehicles. As additional depreciation of 15% allowed on motor vehicles purchased between 23/08/2019 and 31/03/2020. New depreciation rate on motor vehicles are as under:-

10.  (ITR 3,5 and 6) Separate reporting of income chargeable to tax at rate provided in DTAA i.e. special rate (where DTAA is beneficial and benefit has been taken).

11.  (ITR 2 to 7) Separate reporting of income or loss from pass through entities like REITs, InVITs etc. Now section 115UB, allow pass through of losses as well. Various schedules like CG (Capital Gain), SI (Special income) has been changed to incorporate the same.

12.  (ITR 3,5 and 6) Details of tax paid on secondary adjustments (Transfer pricing) as per section 92CE(2A).

13.  (ITR 1 to 6) Separate requirement/disclosures of following deductions claimed under chapter VI-A. Section 80EEA (Housing loan), 80EEB (loan taken for electric vehicles), 80LA (Banks and IFSC units) and 80PA (Producer company).

14.  (ITR 6) Whether Company opting for section 115BA/115BAA/115BAB (applicable on domestic company).

15.  (ITR 6) If Turnover of FY 2016-17 is up to 250 crores then rate of tax for domestic company is 25%. In finance Act, 2019 this limit has been changed from Rs. 250 crore to 400 crores and year has been changed from 2016-17 to 2017-18. Consequentially, year and limit has been changed in ITR.

16.  (ITR 3,5 and 6) Interest payable to Deposit taking NBFC or systematically Important NBFC added in disallowance under section 43B. Finance Act, 2019 added above interest in section 43B i.e. expense will allow only on payment basis.

17.  (ITR 5 and 6) Separate reporting, i.e. Net profit from life insurance business, additions and deductions as per section 30 to 43B, is required for income from life insurance business covered under section 115B.

18.  (ITR 5 and 6) Separate reporting is required for income from units of mutual fund purchased in foreign currency by Off shore fund taxable at special rate of 10% under section 115AB in schedule OS and also added such income in schedule SI.

19.  (ITR 5 and 6) Option to choose ‘Self-occupied property’: As per section 23(5), where the property consisting of any building or land appurtenant thereto is held as stock-in-trade and the property or any part of the property is not let-out during the whole or any part of the previous year, the annual value of such property or part of the property, for the period up to 2 years from the end of the financial year in which the certificate of completion of construction of the property is obtained from the competent authority, shall be taken to be nil. Now option inserted in ITR 5 and 6 to select this type of property under self-occupied property option.

1. Other changes:-

1. (ITR 1 to 4)- Clause wise selection inserted where return is filing under seventh proviso:-

(a)   Deposited > 1 Crore in one or more current accounts maintained with a banking company or a co-operative bank or

(b)   > 2 Lakhs expended for himself or other person for travel to a foreign country or

(c)   > 1 lakhs incurred as expenditure towards consumption of electricity.

1. (ITR 1 to 7)- If return filed in response to notice then Unique document identification number is required.

1. (ITR 1 to 4)-Detailed nature of employment to be given. Previously there were four categories i.e. Government, Public sector undertaking, Pensioners and Others. Now, 6 categories are provided i.e. Central Government, State Government, Public sector undertaking, Pensioners, Others and Not Applicable. 

1. (ITR 1 to 7) Now, can select multiple bank accounts for refund. In that case, refund will be credited to the account decided by the CPC after processing the return.

1. (ITR-2,3,7) Type of company to be reported if the assessee is a director in a company. (Dropdown to be provided for type of company)
2. (ITR-2,3,7) Type of company to be reported if the assessee holds unlisted equity shares of company (Dropdown to be provided for type of company)
3. (ITR 6) SH-1 (Shareholders and price at which shares are issued) schedule not applicable in case of Section 8 company and co. limited by guarantee.
4. (ITR 7) Columns to claim exemption other than 11(1A) including exemption u/s 112A under capital gain schedule has been deleted under ITR 7.
5. (ITR 6) Details of the authorized person verifying the ITR of company to be furnished in Key persons schedule with details of Managing director, Directors, secretary and principal officer(s).

10.  (ITR 5 and 6) Option to claim an exemption under Section 54EE removed as no fund has been notified yet.

11.  (ITR 6) Reporting of share in co-owned land and building by company in ITR 6.

12.  (ITR 6) “No Account Schedule” deleted for IndAS compliant companies as IndAS compliant companies is always required to maintain its books of accounts.

13.  (ITR 3 and 6) Reporting of disallowance under section 40(ba).

Disclaimer:

This article is for informational/educational purposes only, but not promised or guaranteed, to be correct, complete, and up-to-date and hereby disclaims any and all liability to any person for any loss or damage caused by errors or omissions, whether such errors or omissions result from negligence, accident or any other cause.

About Author:

CA Sandeep Bansal, is a practising Chartered Accountant based out of Delhi and is an associate member of the Institute of Chartered Accountants of India since 2015. Possesses sound professional experience for approx. 5 years in the field of Income tax, GST, Auditing, Company law etc. He keens to gain expertise over different areas and ensure to keep himself updated.