The Income Tax Department has recently notified new income tax return (ITR) filing forms for individuals and businesses for assessment year 2023-24 (FY 2022-23). The Central Board of Direct Taxes (CBDT) notified ITR forms 1-6, ITR-V (verification form) and ITR acknowledgement form in advance, a move that will give taxpayers enough time to prepare for relevant disclosures. The I-T department earlier used to notify ITR forms for the relevant financial year either by March or April.

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What are the different forms?

These forms include Sahaj (ITR-1), Form ITR-2, Form ITR-3, Form Sugam (ITR-4), Form ITR-5, Form ITR-6, ITR-V (verification form) and ITR acknowledgement form.

What are the changes in new forms?

As per the modified norms, individuals on whom search and seizure operations have been carried out by tax officials can now file revised return under section 153 C on the basis of self-assessment of their undisclosed wealth in ITR-1.

CBDT has also made certain changes in ITR-1 form with regard to disclosure under Section 139 (1), which is filed voluntarily by persons having annual taxable income of less than Rs 2.5 lakh. These individuals will not be required to intimate in their ITR forms even if their fixed deposits exceeds Rs 1 crore.

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AMRG & Associates Director (Corporate & International Tax) Om Rajpurohit said this decision has been made with the understanding that since the government already has all the necessary mechanism, like PAN, to track such large banking transactions, no additional purpose was being achieved by this disclosure.

Deloitte India Partner Saraswathi Kasturirangan said a separate 'Schedule - VDA' has been added to report income from virtual digital asset such as crypto currency.

"Tax provisions for taxation of VDAs was introduced from FY 2022-23 hence the addition of new schedule is in line with the expectation," Kasturirangan said.

How will early notification of forms help taxpayers?

Nangia Andersen LLP, Executive Director, Maneesh Bawa said early notification of ITR forms will help taxpayers prepare for relevant disclosures that may be required in the forms in a timely fashion.

Who is required to file which form?

ITR - 1 (SAHAJ) can be used by an individual whose total income includes income from salary/pension, or income from one house property (excluding cases where loss is brought forward from previous years); or income from other sources (interest etc.), and agricultural income up to Rs 5,000.

While ITR-2 is filed by people having income from residential property and having income above Rs 50 lakh, ITR-3 is filed by professionals.

ITR-4, also known as Sugam, is available for Individuals, HUFs, and firms (other than LLP) being a resident having total income up to Rs 50 lakh and having income from business and profession which is computed under sections 44AD, 44ADA or 44AE under Income Tax Act. LLP or limited liability partnership is a partnership in which some or all partners have limited liabilities.

ITR-5 and ITR-6 are filed by LLPs and businesses.

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