The income-tax department has categorized taxpayers on the idea of income, source of income and lots of other factors to make sure easy compliance.
Taxpayers having incomes from different categories, thus, need to download and fill different tax Return forms.
For instance, the ITR-2 Form is for people and HUFs not carrying any profession or business. during this article, we cover the subsequent .
Who cannot file ITR 2 for AY 2021-22?
• Any individual or HUF having income from Business or Profession
• Individuals who are eligible to fill out the ITR-1 Form
What is the Structure of ITR 2?
ITR-2 is split into:
Part A: General Information
Schedule S: Details of income from salaries
Schedule HP: Details of income from House Property
Schedule CG: Computation of income under Capital gains
Schedule 112A- From sale of equity share of a corporation or a unit of equity oriented fund /business trust on which STT is paid
Schedule 115AD (I)b(b) (iii) proviso- For Non-Residents -From sale of equity share of a corporation or a unit of equity oriented fund /business trust on which STT is paid
Schedule OS: Computation of income under Income from other sources
Schedule CYLA: Statement of income after depart of current year’s losses
Schedule BFLA: Statement of income after depart of unabsorbed loss brought forward from earlier years
Schedule CFL: Statement of losses to be carried forward to future years
Schedule VIA: Statement of deductions (from total income) under Chapter VIA
Schedule 80G: Statement of donations entitled for deduction under section 80G
Schedule 80GGA: Statement of donations for research project or rural development
Schedule AMT: Computation of Alternate Minimum Tax payable under section 115JC
Schedule AMTC: Computation of decrease under section 115JD
Schedule SPI: Statement of income arising to spouse/ minor child/ son’s wife or the other person or association of persons to be included within the income of the assessee in Schedules-HP, CG and OS
Schedule SI: Statement of income which is chargeable to tax at special rates
Schedule EI: Details of Exempt Income
Schedule PTI: undergo income details from business trust or investment fund as per Section 115UA, 115UB
Schedule FSI: Statement of income accruing or arising outside India.
Schedule TR: Details of taxes paid outside India
Schedule FA: Details of Foreign Assets and income from any source outside India
Schedule 5A: Statement of apportionment of income between spouses governed by Portuguese Civil Code
Schedule AL: Asset and liability at the year-end (applicable just in case the entire income exceeds Rs 50 lakhs)
Schedule DI: Schedule of tax-saving investments or deposits or payments to say deduction or exemption within the extended period from 1 April 2020 until 30 June 2020
Part B-TI: Computation of Total Income
Part B-TTI: Computation of liabilities on total income
Tax payments- Details of payment of advance tax and self-assessment tax
Details to be filled if the return has been prepared by a income tax return Preparer
How to file ITR 2 Form ?
You can submit your ITR-2 Form either online or offline.
Only the subsequent persons can file their ITR offline:
Individuals who are of the age of 80 years or more.
Return are often filed offline by:
By furnishing a return during a physical paper form
By furnishing a bar-coded return
The tax Department will issue you an acknowledgement at the time of submission of your physical paper return.
By furnishing the return electronically under digital signature
By transmitting the info electronically then submitting the verification of the return reciprocally Form ITR-V
If you submit your ITR-2 Form electronically under digital signature, the acknowledgement are going to be sent to your registered email id.
You can also prefer to download it manually from the tax website. you’re then required to sign it and send it to the tax Department’s CPC office in Bangalore within 120 days of e-filing.
Remember that ITR-2 is an annexure-less form i.e. you are doing not need to attach any documents once you send it.
Major changes introduced in ITR 2 for AY 2021-22
- ITR forms are updated to incorporate a declaration of selecting between old or new tax regime introduced by the Finance Act 2020 under section 115BAC. Form 10IE must be submitted to the ITR department before filing ITR if the assessee chooses to pay tax consistent with the new tax regime. ITR forms seek the acknowledgement number of Form 10IE just in case the assessee is choosing the new tax regime.
- Finance Act 2020 allowed to defer the payment or deduction of tax on ESOPs allotted by an eligible start-up covered under Section 80-IAC. If an employee receives ESOPs from an eligible start-up as mentioned under Section 80-IAC regarding which the tax has been deferred, the Part B of Schedule TTI (Computation of liabilities on total income) seeks the disclosure of this deferred tax.
- Finance Act 2020 shifted the taxability of dividend income from the company’s hands to the investor’s hands. Sections 10(34), 10 (35), 115-O, 115-R, 115BBDA are amended. a replacement row has been added in Schedule OS to permit deduction of expenses like interest from the dividend income. Also, a replacement row has been added under schedule OS to include details of dividend income taxable within the hands of the unitholders of business trust.
- All ITR forms prompt the return filers to supply a quarterly hack of the dividend income for the aim of interest calculation under section 234C.
- The ITR forms are updated to incorporate the effect of marginal relief by showing ‘surcharge calculated ‘before marginal relief’ also as ‘after marginal relief’. Previous to the present , no separate effect was required to be shown within the ITR Forms.
- Schedule DI inserted within the previous ITR forms for any investment made for the extended period allowed, i.e. 1st April 20 to 31st July 20, is now faraway from all the ITR Forms.
- Section 50C governs the determination of the worth of the sale consideration just in case of land or building or both. If the sale consideration is a smaller amount than the stamp tax value, then the stamp tax value are going to be considered the complete value of consideration apart from a difference of fifty . Finance 2020 increased the tolerance limit from 5% to 10%, and therefore the changes are made within the ITR.
- Separate disclosure of money donation under schedule 80GGA along side date is required within the ITR Form.
- ITR form has been updated with a replacement column under schedule 112A and 115AD (1)(b)(iii) proviso to be ready to provide the small print of the character of securities transferred. Also, both the schedules are updated to offer the ‘grandfathering clause’ effect by allowing to say the small print like Sale price, FMV and COA of the securities.
Who is eligible to file ITR 2 for AY 2020-21?
ITR Form 2 is for people and HUF receiving income aside from income from “Profits and Gains from Business or Profession”. Thus persons having income from the subsequent sources are eligible to file Form ITR 2:
Income from Salary/Pension
Income from House Property(Income are often from quite one house property)
Income from Capital Gains/loss on sale of investments/property (Both Short Term and Long Term)
Income from Other Sources (including winning from Lottery, bets on Race Horses and other legal means of gambling)
Foreign Assets/Foreign Income
Agricultural Income quite Rs 5000
Resident not ordinarily resident and a Non-resident
A Director of any company and a private who is invested in unlisted equity shares of a corporation are going to be required to file their returns in ITR-2.
Major changes introduced in ITR 2 for AY 2020-21
RNORs and non-resident individuals need to file their tax return in ITR-2 even just in case of total income below Rs 50 lakh.
The taxpayer should disclose (a) the quantity of money deposits above Rs 1 crore within the current accounts with a bank, (b) expenditure incurred above Rs 2 lakh on foreign travel (c) expenditure incurred above Rs 1 lakh on electricity.
Resident individuals who own quite one house property should also file their tax return in ITR-2.
ITR-2 continues to use to resident individuals who have total income exceeding Rs 50 lakh.
Any individual taxpayer having income from business or profession cannot use ITR-2.
In case a private may be a director during a company or holds unlisted equity investments, the ‘type of company’ should even be disclosed
In case of short-term or future capital gains from sale of land or building or both, the small print of the buyer(s) i.e. name, PAN or Aadhaar, percentage share of ownership and address need to tend .
A separate schedule 112A for the calculation of the long-term capital gains on the sale of equity shares or units of a business trust which are susceptible to STT.
Under ‘income from other sources’, a taxpayer should provide the small print of ‘any other income’.
The details of the deductions against ‘income from other sources’ should be provided.
The ‘Schedule VI-A’ for tax deductions is amended to incorporate deduction under section 80EEA and section 80EEB.
In the case of a business trust or investment fund, the small print of ‘capital gains’ income and ‘dividend’ income should be provided.
The details of tax write-off claims for investments or payments or expenditure made between 1 April 2020 until 30 June 2020.
While providing the small print of bank accounts, if a taxpayer selects multiple bank accounts for credit of refund, the tax department may choose any account for processing the refund.
Major changes introduced in ITR 2 for AY 2019-20
Given that ITR-1 isn’t applicable for the RNORs and therefore the non-residents, they need to necessarily accompany ITR-2 for filing their return of income
The applicability of ITR-2 has been made more clear in the maximum amount as now it’s applicable for people and HUF having income aside from income under the top “Profits and Gains from Business or Profession”
The field for residential status has been categorised into “Residential status in India (for Individuals)” and “Residential status in India (for HUF)”.In case of “Residential status in India (for Individuals)”, the three sub-categories – “Resident”, “Resident but not Ordinarily Resident’ and “Non-resident”, are mentioned requiring the individual to tick the precise category to which they belong. Taxpayers need to mention the amount of days of residency in India.Further, within the case of non-resident, a private is additionally required to specify the jurisdiction(s) of residence during the previous year providing the Taxpayer Identification Number(s) of the relevant jurisdictions. Also, just in case the individual may be a Citizen of India or an individual of Indian Origin (PIO), the duration of stay in India during the previous year (in days) and therefore the duration of stay in India during the 4 preceding years (in days).
In a case where the ITR is filed by a representative assessee, additional information about the capacity of the representative assessee (by way of choice during a sink provided) has got to tend .
An individual taxpayer has got to give information about the Directorship held in any company during the previous year, also mentioning whether the shares are listed or unlisted.
An individual taxpayer has got to give information about the investment in unlisted equity shares and therefore the movement in such investment throughout the year.
Under income from salaries, the subsequent details need to be provided:1. Salary as per section 17(1)2. Value of perquisites as per section 17(2)3. Profit in lieu of salary as per section 17(3)In case of salary received from quite one employer, the gross salary with the above break-up has got to be provided for every such employment. From the entire gross salary, the subsequent need to be deducted:1. Allowances exempt under section 10 – details need to be specified2. Deductions under section 16
Under income from house property, furnishing of PAN of tenant is mandatory, if tax is deducted under section 194-IB. Furnishing of TAN of tenant is mandatory if tax is deducted under section 194-I.
In case of short-term or future capital gains from sale of land or building or both, the small print of the buyer(s) i.e. name, PAN, percentage share of ownership and address need to tend . PAN has got to be mandatorily given just in case of TDS under section 194-IA or when PAN is quoted by buyer within the documents.
Interest income within the nature of undergo income has got to be disclosed under “Income from other sources”.
Information about accrual/ receipt of income from other sources on a quarterly basis regarding dividend income and income by way of lotteries, crossword puzzles, races, games etc. for the aim of calculation of interest under section 234C.
Under the carried forward and depart of loss: Categorization of income short term and future capital gains taxed at special rates in India as per DTAA and net from other sources chargeable at applicable rates.
Introduction of section 80TTB deduction for oldster .
Bifurcation of donation qualifying for deduction under section 80G into cash and other mode.
Details of donations for research project and development under section 80GGA with details of name, address, PAN, cash and other mode of donation and eligible amount.
Schedule AMT – computation of Alternate minimum tax payable under section 115JC and Schedule AMTC – computation of decrease under section 115JD is introduced.
While disclosing income of specified persons under schedule SPI, the “Nature of income” is replaced with “Head of income”.
Under Schedule SI, the subsequent incomes charged at special rates are added:1. Short term and future capital gains2. the other income chargeable at special rates3. Other sources of income chargeable at special rates4. Other sources of income chargeable at special rates in India as per DTAA5. undergo income within the nature of future and short term capital gains6. through income within the nature of income from other sources
Under Schedule EI, following disclosures are required just in case of agricultural income exceeds Rs. 5 Lakhs:
Name of district along side pin code during which agricultural land is found
Measurement of agricultural land in Acre
Whether the agricultural land is owned or persisted lease (drop right down to be provided)
Whether the agricultural land is irrigated or rain-fed (drop right down to be provided)
Above disclosure to be provided separately for every agricultural land
Under Schedule EI, information about income not chargeable to tax as per DTAA giving details like amount and nature of income, country name and code, Article of DTAA, Head of income and whether TRC obtained.
Details of pass-through income not chargeable to tax.
Under schedule FA, under the small print of foreign assets and income from any source outside India below details are required:
Details of Foreign Depository Accounts held (including any beneficial interest) at any time during the relevant accounting period
Details of Foreign Custodial Accounts held (including any beneficial interest) at any time during the relevant accounting period
Details of Foreign Equity and Debt Interest held (including any beneficial interest) in any entity at any time during the relevant accounting period
Details of Foreign Cash Value Insurance Contract or Annuity Contract held (including any beneficial interest) at any time during the relevant accounting period