INDIA: INCOME TAX RETURN FORMS FOR THE TAX YEAR 2018-19 NOTIFIED - PWC
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Insights
from Global Mobility
India: Income tax return forms for
the tax year 2018-19 notified
April 10, 2019
In brief
The Indian government introduced new income tax return forms applicable for the tax year (fiscal year)
2018-19. However, the detailed instructions to complete these forms are yet to be ‘notified.’ The forms
include several changes aimed at collecting additional details to help authorities automatically validate or
cross-check income and other items with information from other sources.
In detail as NR in India are required taxation scheme is now
High-level summary to report their actual number restricted only to ROR
of days in the relevant tax individuals having total
Some key changes include the year and in the last four income not exceeding INR 5
following: financial years immediately million.
For better transparency, preceding the relevant tax
The option of paper filing of
individual taxpayers now are year.
ITR 1 and ITR 4 is now
required to select the Similar to last year, a available only for ROR super
relevant rule of residency simplified one page ITR senior citizens (age 80 years
(based on the individual's Form 1 has been notified for or more.)
physical presence in India) Resident and Ordinarily
as compared to the The new ITR forms require
Resident (ROR) taxpayers
residential status selected by disclosure in relation to
whose total income does not
them (resident/ not ordinarily unlisted shares with details
exceed INR 5 million.
resident/ non-resident). of opening balance,
However, ROR individuals
acquisition, and transfer
Non-resident (NR) claiming expense deduction
during the year, as well as
individuals also are required under the heading ‘income
the closing balance.
to report their overseas from other sources’ (except
residency information along for family pension) or holding More details must be
with their taxpayer unlisted shares in India or reported to claim tax treaty
identification number. who are a director in a benefits under the ‘exempt
Overseas Citizen of India company, will no longer be income schedule,’ including
(OCI)/ Person of Indian able to use ITR 1. confirmation of the tax
residency certificate (TRC).
Origin (PIO) taxpayers ITR 4 available for filing a tax
selecting residential status return under the presumptive
www.pwc.comInsights
The foreign assets and income separately, along with additional number (i.e., PAN), as well as
schedule (Schedule FA) requires details, such as the district name and whether shares of the company are
expanded disclosures, i.e., details of pin code, measurement of agricultural listed and the director identification
foreign depository accounts, foreign land, whether owned/ leased, whether number.
custodian accounts, holding of foreign irrigated or rain-fed under the ‘exempt
equity and debt, foreign cash value income schedule.’ Comparison between the forms
insurance/ annuities held, either as an
owner or beneficiary. Individual taxpayers who are directors The scope of the new income tax
of companies now are required to return forms applicable for the tax
Agricultural income exceeding INR 0.5 furnish details of the company name year 2018-19 are tabulated here for
million now is required to be reported along with their tax identification reference:
Particulars ITR 1* ITR 2 ITR 3 ITR 4*
Income from salary/ pension
Income from one house property (excluding brought
forward loss of past years or current year loss to be carried
forward)
Income from other sources (excluding loss under this
heading, claim of expense as deduction under section 57
of the Income tax Act, 1961 ( the Act), except against
family pension as prescribed, winning from lottery, income
from horse races, dividend income from domestic company
exceeding INR 1 million, unexplained cash credit/
investments/ money/ expenditure/ amount borrowed or
repaid on hundi)
Income from more than one house property (including one
house property with brought forward loss of past years or
current year loss to be carried forward)
Capital gains/ losses
Income from other sources (including loss under this
heading, claim of expense as deduction under section 57,
except against family pension as prescribed, winning from
lottery, income from horse races, dividend income from
domestic company exceeding INR 1 million, unexplained
cash credit/ investments/ money/ expenditure/ amount
borrowed or repaid on hundi)
Resident and ordinarily residents having income from a
source outside India or having foreign assets, foreign bank
accounts, and signing authority in any account located
outside India, etc.
2 pwcInsights
Agricultural income (exceeding INR 5,000)
Relief under section 90 (DTAA)/ section 91 of the Act
Income from business or profession
Income from business or profession taxable under
presumptive basis
*ROR Individuals (other than a director of a company and/ or not holding unlisted equity shares) having total income up to
INR 5 million are only eligible to use ITR 1 or ITR 4, as relevant.
More detail about changes relevant for individuals:
Changes introduced Reference in Applicable Observations
return forms ITR form
Eligibility to file ITR 1 - ITR 1 ITR 1 can be filed only by an individual qualifying
as ROR, and whose total income does not
exceed INR 5 million; the following individuals
have been specifically excluded, and thus,
cannot file ITR 1:
director in a company, or
held any unlisted equity share in a
company, or
claimed any deduction against ‘income
from other source’ (other than family
pension)
assessable in respect of another person’s
income in which tax has been deducted at
source.
Eligibility to file ITR 4 - ITR 4 Option to file ITR 4 has been restricted only for
(presumptive taxation) taxpayers having total income not exceeding INR
5 million and taxable on a presumptive basis.
However, this option is available only for an
ROR taxpayer who is neither a director in a
company nor a person that holds any unlisted
equity share in a company, or is assessable with
respect to another person’s income in which tax
has been deducted at source.
Reporting for NR General ITR 2 & 3 If an individual qualifies as an NR of India and a
information resident of another country, if any, he/she is
required to report the following:
Jurisdiction of residence
Taxpayer identification number
In the case of citizen of an India/ person of Indian
origin, actual stay details in India also must be
provided.
3 pwcInsights
Additional details required in Salary ITR 1,2, 3, & 4 Exempt allowance to be shown separately along
relation to salary income information with the bifurcation for deductions claimed under
section 16 of the Act
The tax deduction account number (TAN) of the
employer must be reported on ITR 2 and 3.
Details of unrealised rent or Income from ITR 1 & 4 This disclosure regarding deemed let out property
arrears of rent received and house property has been introduced to identify cases where rental
option to disclose deemed let income has been offered on a notional basis.
out property
Requirement to quote PAN/ Schedule HP ITR 2 & 3 Moved from Schedule TDS to Schedule HP
TAN of the tenant
Additional columns for reporting Schedule CG ITR 2 & 3 Keeping in line with the changes made in the Act,
of capital gains corresponding disclosure fields have been
introduced to report taxable capital gains.
In addition, the prescribed details of the buyer
must be provided if transfer of any immovable
property.
Separate column to report pass- Schedule ITR 2 & 3 Separate columns have been introduced to report
through income HP,CG, & OS pass-through income in the nature of house
property, capital gains, and income from other
sources.
Reporting of exempt income Schedule EI ITR 2 & 3 Scope of reporting has been expanded to report
additional details if agricultural income exceeds
INR 0.5 million. In such cases, additional
information must be reported, such as the name of
the district with pin code, measurement of
agricultural land, whether owned/ leased, whether
irrigated or rain-fed under the ‘exempt income
schedule.’ In addition, reporting of income not
chargeable to tax under the Double Taxation
Avoidance Agreement (DTAA) must be disclosed in
this schedule.
Additional disclosure under Schedule FA ITR 2 & 3 Column A, which includes details of foreign bank
Foreign Assets accounts, has been reframed to include details of
the following:
Foreign depository accounts held
Foreign custodian accounts held
Foreign equity and debt interests
Foreign cash value insurance contracts or
annuity contracts.
The takeaway sources. This will not only improve the taxpayers in India. OCI/PIO
processing of tax returns in an individuals claiming NR status in their
The authorities made several changes automated environment, but also help India tax returns should carefully track
to the forms with the aim of gathering to check on ‘income-escaping’ cases. the number of days they stay in India
additional details to automatically and provide accurate details on the
validate or cross-check income Seeking details about overseas tax return. Such details can be easily
and other items with information the residency from NRs will help to cross-checked and validated with
authorities may have from other validate treaty relief availed by such records available from immigration
4 pwcInsights
authorities. The latter also has has information exchange treaties. However, considering the Indian
adopted automated processes and Such overseas financial details will be government’s focus on tightening
can track details of an individual’s cross-checked, thereby putting a compliance, global mobility managers
visits into India. tighter control on foreign ‘income- of companies may consider sharing
escaping’ cases. this Insight with their mobile
RORs now will be required to provide employees to take a note of these
more details of their overseas assets, Foreign nationals who come to India changes diligently and ensure that
such as foreign depository accounts for a period of three to five years and they provide accurate details to avoid
and foreign custodian accounts. The become ROR of India will face more any questioning from the tax
Indian government already has challenges in making numerous authorities at a later stage.
started receiving details automatically disclosures relating to their overseas
from several countries with which it assets and financial information.
Let’s talk
For a deeper discussion of how this issue might affect your business, please contact your Global Mobility Services engagement
team or one of the following professionals from PwC India:
Global Mobility – India
Kuldip Kumar Sundeep Agarwal Ishita Sengupta
+91 (124) 616 9609 +91 (22) 6119 8438 +91 (22) 6119 8440
kuldip.kumar@pwc.com sundeep.agarwal@pwc.com ishita.sengupta@pwc.com
Ravi Jain Anand Dhelia
+91 (80) 4079 6024 +91 (80) 4079 6076
ravi.jain@pwc.com anand.dhelia@pwc.com
Global Mobility – United States
Peter Clarke, Global Leader
+1 (646) 471-4743
peter.clarke@pwc.com
Our insights. Your choices.
Select 'Tax services' as your Services and solutions of interest to receive more content like this.
Set your preferences today
© 2019 PricewaterhouseCoopers LLP, a Delaware limited liability partnership. All rights reserved. PwC refers to the United States member firm, and may sometimes refer to
the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.
SOLICITATION
This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.
At PwC, our purpose is to build trust in society and solve important problems. PwC is a network of firms in 158 countries with more than 250,000 people who are committed to
delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com/US
5 pwcYou can also read
