Last 3 days to file I-T returns: 7 changes you must be aware of

Reuters

 FP :Bindisha Sarang Jul 29, 2013

Change is inevitable – except from the vending machine, is a funny internet one-liner. But, at times a few minor changes do impact life, take for instance the ones in filing your income tax returns (ITRs). As usual, this year too the income tax (IT) department has brought about a few such changes which you have to be aware of while filing your ITRs. To know more, read on.

* The most important change this year is with compulsory e-filing.

Filing returns online was compulsory for firms, companies and individuals earning more than of Rs 10 lakh last year. This limit has been brought down to Rs 5 lakh this year, that is assessment year 2013-14. “E-filing is compulsory for people earning more than Rs 5 lakh. This is total income i.e. income amount after claiming tax deductions such as Section 80 deductions,” said Archit Gupta, Founder, Cleartax.in, an online e-filing portal. So, if you fall in this category, you can e-file your ITRs at the tax department’s website or use portals like Cleartax.in, Taxspanner.com, or Myitreturn.com, to name a few.

Reuters

* Another change is in the forms you have to fill. While choosing the form many choose the ITR 1 form, but going forward if you have exempt income exceeding Rs 5,000, you will have to choose the ITR2 form. Common examples of exempt income, is interest earned from Public Provident Fund (PPF), dividend earned from shares, interest earned form tax free bonds and the like. So, ensure you choose the correct form, you can get more info here.

* Last year, the IT department had said that all those who hold foreign assets have to compulsorily e-file. You had to provide details of all foreign assets on the form and this was brought about with a new schedule in the ITR2 and ITR4 forms. This year, you will have to give details of all income earned from foreign countries on your relevant the ITR form. This is over and above the declaration of all foreign assets which you have to declare on your ITR form.

* There is a change in the declaration of assets and liabilities for business people. “If you earn income from business or profession and your total income exceeds Rs 25 Lakh, you have to provide the details of all your personal and business assets and liabilities in the ITR form itself. This is for people filling in ITR-3 and ITR-4,” said Gupta.

* The budget for 2011-12 had added a new section 80 TTA in tax rules, under which you will be able to get a tax benefit for interest income of up to Rs 10,000 from savings accounts in any bank. For this, you just need to declare you interest income. Keep in mind, it’s for savings account and not for savings-cum-FD accounts aka sweep-in accounts.

*Another minor, but important change comes in the bank account detail that you have to provide on the ITR form. From this year, you don’t need to provide the 9 digit MICR number, instead you will have to give your branch’s IFSC code. You can get this code from your bank’s website. Also, if you are eligible for a refund, you can also get it directly transferred (ECS) into your account. But you have to provide a 11 digit bank account number. If your bank account number is not 11 digits, then you will receive the refund via a cheque at your mailing address.

* And finally, from this assessment year, you can claim within the existing limit a deduction of up to Rs 5,000 for preventive health check-up. So if you have done any kind of preventive health check-ups, like blood tests and the like, keep the bills and you will be able to use the same to get a tax deduction. There is a good possibility you’ve missed claiming this deduction, make sure you make use it while filing returns.

These are a few changes you should be aware of while filing tax returns. The IT department is getting stricter by the day. We suggest you take the help of a tax professional or tax portal to ensure you get it right.