Income Tax News: For the assessment year (AY) 2024–2025, individuals and entities with annual total income up to ₹50 lakh are required to file ITR forms 1 and 4, according to a notification from the Income Tax Department. The forms were notified on Friday by the IT Department.
A Pleasant Surprise for Taxpayers
“Changes introduced in new ITR forms 1 and 4 notified for Assessment Year 2024-25. Surprising taxpayers with an unexpected and welcome gesture, the CBDT has played the role of an early Santa Claus this year by unveiling the Income Tax Return(ITR) Forms 1 and 4 for the Assessment Year 2024-25. These ITR Forms will be applicable for filing income tax returns for income earned during the previous year 2023-24 (between 01-04-2023 to 31-03-2024),” said Naveen Wadhwa, Vice President Research, Taxmann.
Unprecedented Early Release
Usually in February or March, the department notifies the ITR form prior to the commencement of the following assessment year. This unexpected early release not only deviates from the scheduled release date, but it also suggests that taxpayers will have more time to become acquainted with the changes, acquire the required paperwork, and file their returns more accurately.
ITR Form 1
For many small and medium taxpayers, there is an ITR Form 1 (Sahaj). A resident individual with income up to ₹50 lakh who gets income from a job, one house property, other sources (interest), and up to ₹5,000 in agricultural revenue may file a sahaj.
ITR Form 4
A lot of small and medium taxpayers can use the easier ITR Form 4 (Sugam) form. Individuals, HUFs, and companies (apart from Limited Liability Partnerships (LLPs)) who are residents and have combined income of up to ₹50 lakh, including income from their businesses and professions, are eligible to file for Sugam.
Important adjustments to the new ITR Forms 1 and 4
- The only thing an assessee filing an ITR 1 needs to do is specify which tax regime he wants to use in his income return. Form 10-IEA must be submitted by an assessee filing an ITR 4 in order to opt out of the new tax system.
- In the new ITR Forms 1 and 4, a new column has been added to claim the deduction under section 80CCH. A new section, 80CCH, was added to the Finance Act 2023. It states that anyone who subscribes to the Agniveer Corpus Fund and enrols in the Agnipath Scheme, or who subscribes after November 1, 2022, will be eligible for a tax deduction for the entire amount deposited in the Agniveer Corpus Fund.
- To claim an increased turnover limit, the “Receipts in Cash” column has been added to the ITR-4. The turnover threshold limit for choosing the presumptive taxation scheme under Section 44AD has been raised from ₹2 crore to ₹3 crore by the Finance Act, 2023, provided that cash receipts do not exceed 5% of total turnover or gross receipts for the prior year.
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