Govt. Simplifies Income Tax Return Form To 3 Pages Only; No Need To Declare Foreign Visits & Bank Balance
Much to the relief of tax payers in the country, Finance Ministry has issued a fresh notification regarding filing of Income Tax for the financial year 2014-15 (Assessment year 2015-16) making the process even simpler.
As per the proposal shared by the Government, a new ITR 2A form will be provided, which will have only 3 pages to fill. Infact for both ITR 2 and ITR 2A, the same format has been proposed, which is a welcome relief from the dreaded 14 page format followed as of now.
The format of existing IT Return forms was criticized and condemned by the business community and tax payers all over the country.
Major highlights from the notification released by Ministry of Finance:
- No need to provide details about foreign trips and visits in the IT Return form; this is a huge relief for those who wish to keep their privacy intact. Under the new rules, only Passport number needs to be entered.
- No need to provide balance details of your various bank accounts. However, IFSC code and bank account numbers of all saving/current bank accounts needs to be updated. Considering that IT Dept. already has PAN Card details of all tax payers, extracting this information won’t be a huge task for the Govt. Additionally, the tax payer doesn’t need to provide information on the dormant accounts, which are older than 3 years.
- IT Department is creating a new online based tool for filing IT Returns, which will be active within June 3rd week. Tax Payers can directly log on to the tool, and file their returns.
- In case there are other details which are required by the IT Dept., then the user will be notified regarding the same via schedules. This makes the initial filing of taxes easy and fast.
- The last date for filing IT Returns have been extended till August 31.
About ITR 1, 2 and 2A
In the note released by the Finance Ministry, the definition and purpose of the ITR forms have been clearly stated. ITR 2A is for those tax payers and Hindu Undivided Family (HUF) who own more than one house property but do not have capital gains from the same.
ITR 2 is for those who own more than one house property and have capital gains from the same.
Meanwhile ITR 1 is for those who have only 1 house property, and earning capital gains from the same. Additionally, ITR 1 will also be applicable to those whose agricultural income exceeds Rs 5000 annually.
Easier Norms for Expats & Foreign Nationals
Expats and Foreign Nationals who are not Indians and are living in India on either business purpose, employment purpose or education need not declare their overseas assets and income while filing for IT Returns. This is a huge relief for them, as they could have been prosecuted under the new ‘Black Money Law’ being implemented in India.
The Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015 or the Black Money law has powers to imprison an expat or a NRI for 5-6 years for ‘willful attempt to evade taxes’ and for failure to file return of foreign assets and bank accounts.
You can find the official notification from the Finance Ministry here.