Simplified Guide to the Updated Income Tax Return (ITR) Forms for FY 2023-24

Introduction:

The Central Board of Direct Taxes (CBDT) has introduced revamped Income Tax Return (ITR) forms for the fiscal year 2023-24, aiming to enhance efficiency and transparency in the tax filing process. Let’s explore the key highlights of these updated forms and how they will impact taxpayers.

Key Highlights of the Revamped ITR Forms:

1. ITR 1 (Sahaj):

• Designed for resident individuals with a total income of up to ₹50 lakh.
• Includes earnings from salaries, one house property, and other sources.
• Taxpayers filing this form must now indicate their choice of tax regime directly in the Return of Income.

2. Changes in ITR 2 and ITR 3:

• Introduction of additional disclosure fields, such as Legal Entity Identifier (LEI) number and audit report acknowledgment number.
• Taxpayers undergoing a tax audit can now verify their ITR using the electronic verification code (EVC) instead of digital signature certificates (DSCs).

3. Form 10-IEA Requirement for ITR 4 Filers:

• Taxpayers filing ITR 4 must submit Form 10-IEA to opt out of the new tax regime, facilitating a smooth transition.

4. Section 80CCH Deduction Reporting:

• Inclusion of a new column in ITR 1 and 4 for reporting deductions under section 80CCH.

5. Cash Turnover Disclosure in ITR 4:

• Introduction of a “receipts in cash” column for ITR 4 filers to enhance transparency.

6. Enhanced Details Requirement for Companies in ITR 6:

• Mandates additional details in ITR 6, including LEI, MSME registration number, and reasons for tax audit.

7. Acknowledgement Number and UDIN Requirement in ITR 6:

• Companies filing ITR 6 must provide acknowledgment numbers and Unique Document Identification Numbers (UDIN) for audit reports.

8. LEI Requirement for Refund via ITR 6:

• Companies seeking refunds of ₹50 crore or more must furnish the Legal Entity Identifier (LEI) as part of their filing requirements.

9. Clauses for Timely Payments to MSMEs in ITR 6:

• Introduction of additional clauses in ITR 6 for sums payable to micro or small enterprises to promote timely payments and compliance with the MSME Act.

Conclusion:

These comprehensive revisions aim to streamline the income tax filing process, ensuring a robust framework for disclosure and compliance. As taxpayers prepare for the upcoming fiscal year, these revamped ITR forms promise a smoother and more transparent filing experience.

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