Key changes in ITR Forms for AY 2021-22 - Part 4: ITR 6

Neethi V. Kannanth | Last updated: 13 October 2021

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This article details the significant changes introduced in the ITR 6 form for Assessment Year 2021-22, specifically for companies. Key updates include the removal of filing options for notices under sections 153A and 153C, and adjustments to tax rates and thresholds for domestic companies based on turnover. Several schedules have been revised, with some sections like 115BBDA and DDT removed, and others like Schedule OS and Schedule VI-A updated to reflect new dividend taxation rules and deductions.

Who is eligible to use this Return Form?

This Return Form can be used by a company as per section 2(17) of the Income Tax Act, This form is filed by a company other than a company which is required to file return in Form ITR‐7. As per section 2(17) of Income Tax Act, company means: ‐

(i) Indian Company (Domestic Company)

(ii) Body corporate incorporated by or under the laws of country outside India

(iii) Any institution, association or body, whether incorporated or not & whether Indian or Non‐Indian which is declared by general or special order of the board to be a company,etc.

ITR 6 Changes AY 2021-22: Key Updates for Companies

Click here to read Part 1: Key Changes in ITR 1 Sahaj and ITR 2
Click here to read Part 2: Key Changes in ITR 3
Click here to read Part 3: Key Changes in ITR 4 Sugam and ITR 5

Key changes (as compared to ITR for AY 2020‐21)

(a) Option of Filing ITR in response to notice u/s 153A and 153C is removed from ITR as the requirement to file ITR under these sections is omitted.

(b) In case of a domestic company, the rate of income‐tax shall be twenty five per cent. of the total income, if the total turnover or gross receipts of the previous year 2017‐18 does not exceed four hundred crore rupees. For AY 2021‐22 the previous year 2018‐19 is changed to 2018‐19

(c) In AY 2020‐21, the threshold limit for a person carrying on business was increased from one crore rupees to five crore rupees in cases where the cash receipts or payments by a business don’t exceed 5% of such receipts or such payments, however in AY 2021‐22 , the limit of five crore rupees is increased to ten crore rupees

(d) The existing restriction of 3 codes in the nature of business/profession schedule is removed

(e) In schedule P & L Account at Sl. No. 62, the form has been enabled to capture section wise profits u/s 44B, 44BB, 44BBA and 44BBB

(f) In schedule BP, Income/ receipts credited to profit and loss account considered Instructions to Form ITR-6 (A.Y. 2021-22) under head "other sources" has been bifurcated into 2 parts as "Dividend income"and "Other than dividend income"

(g) In Schedule BP, Table E "Computation of income from life insurance business referred to in section 115B " has been removed in Schedule BP. And corresponding mapping has been updated in schedule CYLA and Part B‐TI

(h) In Schedule DPM, the column "3a.Amount was adjusted on account of opting for taxation section 115BA" and "3b. Adjusted Written down value on the first day of previous year (3) + (3a)" has been removed . Hence corresponding mapping changes are made in schedule DPM

(i) CBDT vide notification dated 20th September 2019 increased depreciation to 45% on motor cars, motor buses etc w.r.t. assets purchased on or after the 23rd day of August, 2019 but before the 1st day of April, 2020 and are put to use before the 1st day of April, 2020. Therefore, no additions will be allowed in the 45% block in the AY 2021‐22 w.r.t. to such assets.

(j) In Schedule CG, the allowable difference between full value of consideration u/s. 50 C and value of property as per stamp authority has been increased from 1.05 times to 1.10 times

(k) In schedule OS,

(i) The existing drop related to "Dividend income" is bifurcated into 2 parts i.e."Dividend income [other than (ii)]" and "Dividend income u/s 2(22)(e)"

(ii) Dividend will now be taxable from Rs.1/‐ as section 115BBDA is omitted. Accordingly, Interest expenditure u/s 57(1) to earn Dividend can be claimed at sl.no.3

(iii) The existing drop down at Sl. No. 2d "115AD(1)(i)‐ Income received by an FII in respect of securities (other than units referred to in section115AB)" bifurcated into 2 drop downs as under:‐

115AD(1)(i)‐Income being Dividend received by an FII in respect of securities (other than units referred to in section115AB) @20%
115AD(1)(i)‐Income being other than dividend income received by an FII in respect of securities (other than units referred to in section115AB) @20%

(iv) Further new drop downs are inserted in Sl. No. 2d and Sl. No. 2e w.r.t."Interest referred to in section 194LC(1)" and Distributed income being Dividend referred to in section 194LBA

(v) Section 115BBDA is removed from AY 2021‐22 onwards hence corresponding drop downs are removed from sl. No. 2d and 2e of schedule OS

(vi) In existing Sl. No. 10 "Information about accrual/receipt of income from Other Sources"

Field "Dividend Income u/s 115BBDA" is changed to "Dividend income" due to finance Act changes
one more line item is inserted to capture the quarter wise break up of dividend income which is taxable at DTAA Rates. This information will be used to calculate interest u/s 234C.

(l) In Schedule CFL, the bifurcation of PTI loss and other than PTI loss has been removed from "HP loss", "Short term capital loss" and "Long term capital Loss" also corresponding changes mapping /other changes are made in field "Loss distributed among the unit holder"

(m) In Schedule 80GGA,e.f. 01.06.2020, the eligible limit of Donation in cash is changed from Rs. 10,000 to Rs. 2,000. Hence date field is inserted to capture date Instructions to Form ITR-6 (A.Y. 2021-22) of donation in cash

(n) In schedule 80IB , the deductions claimed in following sections are removed due to sunset clause and corresponding mapping changes are made in schedule VI‐A

(i) Deduction in respect of industrial undertaking located in industrially backward states specified in Eighth Schedule [Section 80‐IB(4)]

(ii) Deduction in respect of industrial undertaking located in industrially backward districts [Section 80‐IB(5)]

(iii) Deduction in the case of an undertaking operating a cold chain facility [Section 80‐IB(11)]

(o) In Schedule VI A, under part C new deduction is inserted "Section 80M (Intercorporate dividend) for Domestic Company In Schedule EI, field for "Dividend Income" is removed from exempt income as for AY 2021‐22 onwards dividend income will be taxable in the hands of shareholders . similarly corresponding Changes are also made in schedule OS , schedule Pass Through Income (PTI) to remove reference of section 115O

(p) In schedule TPSA , dropdown for the financial year (FY 2019‐20 or FY 2020‐21) for which option u/s 92CE(2A) is exercised in AY 2021‐22 is inserted

(q) Schedule DDT (Details of tax on distributed profits of domestic companies) has been removed as form AY 2021‐22 onwards companies are not required to pay dividend distribution tax u/s 115O

(r) Schedule DI (Details of Investment) has been removed as it was relevant only for AY 20‐21

(s) In Schedule Part B TI "Sl. No.11b" Part C deductions claimed under chapter VI‐A, restriction of ii5 of BFLA is removed due to deduction claimed u/s 80M

(t) In Schedule TDS, earlier TDS credit is allowed only if corresponding income is being offered for tax this year, however an exception is being added for TDS u/s 194N. Also the label is amended to include form 16D for the claim of TDS

(u) Annexure 2 is inserted in instructions w.r.t.ITR fields which should be tallied with the corresponding amount mentioned in the Tax Audit report i.e Form 3CA‐3CD/3CB‐3CD, if applicable.

(v) Upload level validations table is modified w.r.t. mapping changes and new rules

FAQ :

ITR Form 6 is designed for companies, as defined by section 2(17) of the Income Tax Act. This includes Indian companies, bodies corporate incorporated outside India, and certain other institutions or associations declared as companies by the board. It is not for companies required to file under Form ITR-7.

Key changes include the removal of the option to file ITR in response to notices under sections 153A and 153C. The threshold for businesses with cash receipts or payments not exceeding 5% has been increased to ten crore rupees. Additionally, several schedules have been updated, with some sections removed and new reporting requirements introduced.

Yes, for domestic companies, the income tax rate is twenty-five per cent if the total turnover or gross receipts for the previous year 2018-19 did not exceed four hundred crore rupees. The threshold limit for businesses where cash receipts or payments do not exceed 5% has been increased from five crore rupees to ten crore rupees.

The option to file under sections 153A and 153C has been removed. Schedule DDT (Details of tax on distributed profits) and Schedule DI (Details of Investment) have also been removed. Several other schedules, including P&L Account, BP, DPM, CG, OS, CFL, 80GGA, 80IB, VI A, EI, TPSA, and TDS, have seen modifications or updated mappings.

Dividend income is now taxable in the hands of shareholders from AY 2021-22 onwards, as section 115BBDA has been omitted. Consequently, the field for 'Dividend Income' has been removed from exempt income in Schedule EI, and corresponding changes have been made in Schedule OS to bifurcate dividend income and capture quarter-wise details for interest calculation under section 234C.