One Nation, One ITR Form, 40 Questions: New Proposal

Arjuna (Fictional Character): Krishna, what is the buzz going around regarding proposed One Nation, One ITR Form?

Krishna (Fictional Character): Arjuna, CBDT has released draft common Income Tax Return Form by merging all the existing returns of income except ITR-7 for all taxpayers barring trusts and non-profit organizations, to which all stakeholders and general public can provide inputs up to December 15.

Arjuna (Fictional Character): Krishna, what is the difference between existing ITR Forms and proposed ITR Form?

Krishna (Fictional Character): Arjuna, Presently, taxpayers are required to furnish their Income-tax returns in ITR-1 to ITR-7 depending upon the type of person and nature of income. The current ITRs are in the form of designated forms wherein the taxpayer is mandatorily required to go through all the schedules, irrespective of the fact whether that particular schedule is applicable or not. The proposed ITR form would be customized for taxpayers with applicable schedules, based on certain questions which apply to him and fill the schedules linked to those questions where the answer has been given as 'yes'. Instructions have been added to assist the filing of the return containing the directions regarding the applicable schedules.

Arjuna (Fictional Character): Krishna, does this mean ITR-1 (Sahaj) and ITR-4 (Sugam), used by most individual taxpayers, will be withdrawn?

Krishna (Fictional Character): Arjuna, The current ITR-1 and ITR-4 will continue. This will give an option to such taxpayers to file the return either in the existing form (ITR-1 or ITR-4), or the proposed common ITR, at their convenience but taxpayers filing ITR-2, ITR-3, ITR-5 and ITR-6 would not have the option to file the old forms.

Arjuna (Fictional Character): Krishna, what is the scheme of the proposed ITR Form?

Krishna (Fictional Character): Arjuna, the scheme of the proposed ITR Form is as follows:

1. Basic information (comprising parts A to D): Part A contains 1 question regarding assessment year, Part B contains 8 questions regarding taxpayer identification details like Name, PAN, Aadhar, etc, Part C contains 1 question regarding residential status and Part D contains 6 questions regarding ITR Filing requirement such as Section under which ITR is being filed.
2. Schedule of Identification of applicable schedules(Schedule E): Schedule E comprises of 40 "yes/no" questions. If the answer to any question is 'yes', applicable schedules linked to those questions should be filled by the taxpayer and if the answer to any question is 'no', the other questions linked to this question will not be shown to the taxpayer.
3. Schedule for computation of total income (Schedule TI): This comprises of 29 points regarding 5 heads of Income tax i.e. Salary, House Property, Profit and Gains from Business, Capital Gain, Other Sources.
4. Schedule for computation of tax (schedule TTI) comprises calculation of tax payable or refund receivable
5. Details of bank accounts (Schedule BA)
6. Schedule for the tax payments (schedule TXP) comprises advance tax and tax deducted/collected at source details.

Arjuna (Fictional Character): Krishna, what lesson the taxpayer should take from this?

Krishna (Fictional Character): Arjuna,The draft form will make it easier to file returns, as they are not required to see the schedules that do not apply to them, and to considerably reduce the time taken for taxpayers. Also, It will help department to enhance data analytics and catch hold the tax evaders with more and more information asked.