IT- Dept introduces common ITR form for taxpayers

The Income Tax Department has proposed to introduce a user-friendly common ITR form for all taxpayers by merging all existing forms of return of income except ITR-7. Under the finance ministry’s proposal, income from virtual digital assets will have to be disclosed under a separate head.

All taxpayers, except trusts and non-profit organizations, can file returns with the proposed new common ITR form, on which the Central Board of Direct Taxes (CBDT) has invited stakeholder comments by 15 December.

The finance ministry said, “The current ITRs are in the form of designated forms wherein the taxpayer is mandatorily required to go through all the schedules, irrespective of the fact whether that particular schedule is applicable or not, which increases the time taken to file the ITRs.”

However, the current ITR-1 and ITR-4 will continue. This will give an option to such taxpayers to file the return either in the existing form (ITR-1 or ITR-4), or the proposed common ITR, at their convenience.

The scheme of the proposed common ITR is:

· Basic information (comprising parts A to E), Schedule for computation of total income (Schedule TI), Schedule for computation of tax (schedule TTI), Details of bank accounts, and a schedule for the tax payments (schedule TXP) is applicable for all taxpayers.

· The ITR is customized for taxpayers with applicable schedules based on certain questions answered by the taxpayers (wizard questions).

· The questions have been designed in such a manner and order that if the answer to any question is ‘no’, the other questions linked to this question will not be shown to the taxpayer.

· Instructions have been added to assist the filing of the return containing the directions regarding the applicable schedules.

· The proposed ITR has been designed in such a manner that each row contains one distinct value only. This will simplify the return filing process.

· The utility for the ITR will be rolled out in such a manner that only applicable fields of the schedule will be visible and wherever necessary, the set of fields will appear more than once.