1. Form to be used by a taxpayer to file the Income-tax return for the assessment year 2023-24

Salary Income

Income from House Property

Income from business or profession

Capital Gains

Income from Other Sources

Deductions

Total Income

Computation of Tax liability

Others

* ITR-1 can be filed by an Individual only who is ordinarily resident in India. ITR-4 can be filed only by an Individual or HUF who is ordinarily resident in India and by a firm (other than LLP) resident in India.

2. Return cannot be filed in ITR-1 if it is being filed due to the reason of depositing more than Rs. 1 crore in the current account

[ITR 1]
The seventh proviso to Section 139 provides that any person, who is otherwise not required to file the return, shall file the return of income if during the previous year:

(a) He has deposited more than Rs. 1 crore in one or more current accounts maintained with a bank or a cooperative bank;
(b) He has incurred more than Rs. 2 lakhs for himself or any other person for travel to a foreign country;
(c) He has incurred more than Rs. 1 lakh towards payment of electricity bill; or
(d) He fulfils such other conditions as may be prescribed.

If a person falls under any of the points mentioned above, filing of return shall be mandatory for
him, irrespective of the fact that he is not liable to file the return of income. Return can be filed in ITR forms 1 to 4 depending upon the nature of income he is earning.

However, the option to file a return in ITR-1 by an individual, who has deposited more than Rs. 1 crore in one or more current accounts, has been removed for the Assessment Year 2023-24.

3. Check-box for “self-occupied” omitted under Schedule HP for companies

[ITR 6]
A company cannot claim a house property as self-occupied because the term “self-occupied” refers to a property owned and occupied by an individual, not a company. The Schedule HP available under ITR-6 has a check-box to declare a house property as ‘self-occupied’, which wasn’t logical. Accordingly, the reference of self-occupied property from Schedule HP has been removed from the new ITR-6 notified for Assessment Year 2023-24.

4. New Schedule for income from transfer of virtual digital assets

[ITR 2, 3, 5, 6 and 7]
Virtual Digital Asset (VDA) covers crypto assets, Non-fungible tokens (NFTs), and any other digital asset, and it does not cover Indian currency, CBDCs, Foreign currency, and notified digital assets. The Finance Act, 2022 introduced a new’ flat rate’ scheme for the taxation of income arising from the transfer of Virtual Digital Assets (‘VDA’) with effect from the assessment year 2023-24.

Every transfer of virtual digital assets on or after 01-04-2022 shall be covered under this scheme. Further, Section 194S requires the deduction of tax from the payment of consideration on the transfer of VDA.

To bring the necessary changes to the new ITR Form, Schedule VDA has been added.
The Schedule asks for details like the date of acquisition, date of transfer, head under which income is to be taxed, cost of acquisition in case of gift and consideration received.
Taxable income will be recorded in Schedule CG (Capital Gains) or Schedule BP (Business Income) based upon the classification of income under the head of capital gains or business income.

5. Exclusion of dividend income taxable under Section 115BBD from Schedule OS

[ITR-6]
Section 115BBD provides that where a domestic company receives a dividend from a foreign company, in which such domestic company has 26% or more equity, then such dividend income is taxable at a special rate of 15% plus surcharge and cess. With effect from Assessment Year 2021-22, the Finance Act, 2020 abolished the dividend distribution tax provided in Section 115-O to provide that dividends shall be taxed in the hands of the shareholder at applicable rates plus surcharge and cess.
To bring uniformity in the tax treatment of dividends received by Indian companies from specified foreign companies vis-a-vis domestic companies, the Finance Act 2022 amended
Section 115BBD to provide that the provisions of this section shall not apply from the assessment
year 2023-24.
Necessary changes have been made to the ITR-6 by removing the reference to dividend income taxable under Section 115BBD from the ‘Schedule OS’.

6. Turnover from intraday trading is to be reported separately under Part A- Trading Account

[ITR 3 and 5]
The gain or loss arising from intra-day trading, being a speculative transaction, is always taxable under the head’ Profits and Gains from Business or Profession’. ‘Speculative transaction’ means a transaction in which a contract for the purchase or sale of any commodity, including stock and shares, is periodically or ultimately settled otherwise than through actual delivery or transfer of the commodity or scrips.

The new ITR forms have been amended to seek separate disclosure related to intraday trading under Part A – Trading Account. The ITR forms seek the following two additional details from the assessee engaged in intraday trading:

(a) Turnover from Intraday Trading; and

(b) Income from Intraday Trading – transferred to Profit and Loss account.

7. FII/FPI are required to mention the SEBI Registration number

[ITR 2,3, and 5]
In the previous ITR Forms, there was no requirement for FII (Foreign Institutional Investors) or FPI (Foreign Portfolio Investors) to furnish their SEBI (Securities and Exchange Board of India) registration number.

For transparency and accountability, the new ITR forms seek the SEBI registration number allotted to the FIIs and FPIs. Part A- General Information has been modified to include a clause for furnishing such information.

8. Insertion of reference of Section 153C for the return filed in response to a notice

[ITR 1 to 7]
Section 153C provides for the assessment of income of any other person where AO is satisfied that any valuable article seized (or requisitioned) belongs to, any books of account or documents seized (or requisitioned) pertain to or any information contained therein relates to such other person (not the one in whose case the search or requisition proceedings are initiated).

The Finance Act, 2021, introduced a sunset clause with effect from April 1, 2021, to provide that the above assessment process will not apply where the search or requisition proceedings are initiated on or after April 1, 2021.

In cases the search process was initiated before 01-04-2021, it could be possible that the assessment of other person is yet to be made under Section 153C, and the person will be required to file the Income-tax return in response to notice under Section 153C. Hence, the new ITR Forms restore the check-boxes of ‘153C’ in the section of filing status of return income in response to the notice. Earlier, this check-box was removed in the ITR Forms for AY 2022- 23.

9. ARN (Donation Reference Number)is to be mentioned if the donation is eligible for Section 80G deduction.

[ITR 2,3,5, and 6]
Any assessee who has paid any sum by way of donation is eligible to claim a deduction under Section 80G to the extent of 50% to 100% of the donation made. For certain donations, the deduction is allowed subject to the qualifying limit.

In the new ITR forms, a new column has been inserted to disclose ARN(Donation Reference Number) in case the donation is made to entities wherein a 50% deduction is allowed subject to the qualifying limit.

10. Transfer of TCS credit to another person.

[ITR 2,3, 5, 6 and 7]
All citizens who are domiciled in Goa and to whom the Portuguese Civil Code of 1860 apply are governed by the system of Community of Property. Under this system, a person is entitled to inherit 50% of the property of his spouse, and the income there from is also liable to be shared equally among the spouse. Under Section 5A, the statute has recognised the system of community of property for the purpose of assessment in respect of all income other than salary.

In this situation, if an income added to the common pool has been subjected to TCS, the assessees face difficulties in proving their claim for TCS credit. In other similar situations, a person is entitled to claim the credit for tax deducted in the name of another person, i.e., inheritance, etc.

Currently, Income-tax Dept. matches the TCS disclosed in ITR with the amount of TCS as shown in Form 26AS and in case of a mismatch, the Dept. asks the assessee to reconcile the mismatch. Therefore, in the situations mentioned above, the taxpayers were facing difficulties in claiming the TCS credit.

To overcome this problem, the ITR forms introduce new columns in the TCS Schedule, allowing CPC. to correlate the PAN, amount of income, and TCS thereon as disclosed by both parties in their respective return of income. It would be more convenient for the assessee to claim the credit of tax deducted in the name of another person.