Home  /  Daily Current Affairs  /  03-11-2022 / One nation, One ITR Form

One nation, One ITR Form

Posted on November 3, 2022 by admin1  34

In News

  • Recently, the Central Board of Direct Taxes (CBDT) has proposed a single income tax return (ITR) form for all taxpayers.  

How many kinds of ITR forms are there now?

  • There are seven kinds of ITR forms, which are used by different categories of taxpayers. They are as follows:
    •  ITR Form 1, called ‘Sahaj’, is for small and medium taxpayers. Sahaj forms can be filed by individuals who have an income up to Rs 50 lakh, with earnings from salary, one house property/ other sources (interest etc).
    • ITR-2 is filed by people with income from residential property.
    • ITR-3 is intended for people who have income as profits from business/ profession
    • ITR-4 (Sugam) is, like ITR-1 (Sahaj), simple forms, and can be filed by individuals, Hindu Undivided Families (HUFs) and firms with total income up to Rs 50 lakh from business and profession.
    • ITR-5 and 6 are for limited liability partnerships (LLPs) and businesses respectively.
    • ITR-7 is filed by trusts and non-profit organisations.

Changes that has been proposed

  • All taxpayers, barring trusts and non-profit organisations (ITR-7), will be able to use a common ITR form, which will include a separate head for disclosure of income from virtual digital assets.

Rationale behind the move

  • The proposed draft ITR takes a relook at the return filing system in tandem with international best practices.
  • The draft form aims to make it easier to file returns, and to considerably reduce the time taken for the job by individuals and non-business-type taxpayers. 
  • It intends the smart design of schedules in a user-friendly manner with a better arrangement, logical flow, and increased scope of pre-filling.
  • It will also facilitate the proper reconciliation of third-party data available with the Income-Tax department vis-à-vis the data to be reported in the ITR to reduce the compliance burden on the taxpayers. 

Central Board of Direct Taxes (CBDT)

  • Functions and Organization
  • The Central Board of Direct Taxes is a statutory authority functioning under the Central Board of Revenue Act, 1963. 
  • The officials of the Board in their ex-officio capacity also function as a Division of the Ministry dealing with matters relating to levy and collection of direct taxes.
  • Composition and Functions of CBDT
    • The Central Board of Direct Taxes consists of a Chairman and following six Members:
  • Chairman
  • Member (Income Tax & Revenue)
  • Member (Legislation)
  • Member (Administration)
  • Member (investigation)
  • Member (TPS & system)
  • Member (Audit & Judicial) 

Source: IE

 
Previous article Women’s Role during the Farm Law Agitations
Next article Cordy Gold Nanoparticles (Cor-AuNPs)