Glimpse of New requirements in ITR forms for AY 2018-19

1. Additional disclosure requirements for Ind AS Compliant Companies.
[Applicable for ITR 6]

2. Fees for late filing of return [Section 234F].
[Applicable for ITR 1 to 7]

3. Require more details of salary and house property income.
[Applicable for ITR 1 and 4]

4. Additional details to be furnished by taxpayers opting for presumptive scheme such as amount of secured/unsecured loans, advances, fixed assets, capital account etc.
Further, new ITR 4 seeks GSTR no. of the assessee and turnover as per GST return filed by him.
[Applicable for ITR 4]

5. Transfer of TDS Credit to Other Person.
[Applicable for ITR 2 to 7]

6. Capital Gains in case of transfer of unquoted shares.
[Applicable for ITR 2, 3, 5, 6 and 7]

7. Reporting of sum taxable as Gift.
[Applicable for ITR 2, 3, 5, 6 and 7]

8. Now Partners cannot use ITR 2.

9. Revised Depreciation Schedule i.e. the highest rate of depreciation for any block of asset is restricted to 40%
[Applicable for ITR 3, 5 and 6]

10. Details of business transactions with registered and unregistered suppliers under GST.
[Applicable for ITR 6]

11. Assessee claiming DTAA relief is required to report more details.
[Applicable for ITR 2, 3, 5 and 6]

12. Info relating to capital gains exemption to be furnished in detail.
[Applicable for ITR 2, 3, 5 and 6]

13. Disallowance of expenses in case of TDS default (for residuary income).
[Applicable for ITR 2, 3, 5, 6 and 7]

14. Taxability on remission of trading liability in case of ‘Income from other source’.
[Applicable for ITR 2, 3, 5, 6 and 7]

15. Income from transfer of Carbon Credits.
[Applicable for ITR 2, 3, 5, 6, 7]

16. Impact on profit or loss due to ICDS deviation.
[Applicable for ITR 3, 5 and 6]

17. Details of GST paid and refunded.
[Applicable for ITR 3, 5, and 6]

18. Removal of ‘Gender’ from personal information.
[Applicable for ITR 2, 3 and 4]

19. Details of foreign bank account of non-residents.
[Applicable for ITR 2, 3, 4, 5, 6 and 7]

20. Reporting of CSR appropriations.
[Applicable for ITR 6]

21. Break-up of payments/receipts in foreign currency.
[Applicable for ITR 6]

22. Ownership information in case of unlisted company.
[Applicable for ITR 6]

23. Trusts to disclose more information in ITR.
[Applicable for ITR 7]

24. Details of fresh registration upon change of objects [Section 12A].
[Applicable for ITR 7]

25. Taxability of Dividend in excess of Rs. 10 lakhs.[Section 115BBDA]
[Applicable for ITR 7]

26. No deduction for corpus donations made to other institutions [Section 11].
[Applicable for ITR 7]

27. Political Parties to confirm if cash donations are received [Section 13A].
[Applicable for ITR 7]

Financial Tips For 2018

1. Avoid buying property on loans as it eats most of your earnings unless you have a clear plan for its repayment. It’s important to monitor cash flow. Though, the house will be your asset, your liability will be much more.

2. Start a SIP at a very young age. Try to save atleast 15–25 % of your earnings.

3. Avoid buying a car unless you use it everyday.
4. Do not let this sentence scare you. “Mutual fund investment are subject to market risk. Please read the offer documents carefully before investing”. Most people avoid investing in mutual funds just because of this one warning. Yes, there is a market risk, but look at the history and growth of mutual funds.

5. Try having a simple wedding.

6. Atleast 20% of your wealth should be liquid so you can utilize it when necessary.

7. Considering inflation, you are actually losing money if it is in savings bank account. Do not keep huge money in savings bank account.

8. If you invest in stocks, pay due attention.

9. If you invest in stocks have a separate account for delivery investment and Intraday investment. It is easy to monitor this way and also makes tax calculation easy

10. Do not have a belief that property and car make you rich. Its what you save and invest, that is important.

11. Never invest in insurance for returns. Insurance is not an investment option. It is a risk management tool.

12. Never use credit cards for lavish spending. Use credit cards intelligently and for needs not for wants.

13. Cancel all credit cards before you die. Or inform family about all your accounts, credit cards, loans and saving now itself. Even a small residue will cost your family much.

14. Invest on yourself and then on other investments.

15. Always try to balance your earnings with your savings first, then on spending and loans. Never take unnecessary loans. Always have reserve and utilise them and unless no other go never take loan.

16. Always have a plan for future events on your career, life, spending and finance.

17. Always have a reserve on your savings for contingency and urgent situations.

18. Your personal life and health are the most important investment. Do have a regular health check and do healthy workout every day. Stay healthy and live happily.

19. Always remember death can come anytime… please do buy adequate term Insurance if you have dependents.

20. Prepare a Will. It may avoid unnecessary fights after you die.

*Think & Act

GST Council approved principles for filing of new return

GST Council approved principles for filing of new return design based on the recommendations of the Group of Ministers on IT simplification. The key elements of the new return design are as follows –

1. Monthly Return: All taxpayers excluding a few exceptions like composition dealer shall file one monthly return. Return filing dates shall be staggered based on the turnover of the registered person to manage load on the IT system.

2. Composition dealers and dealers having nil transaction shall have facility to file quarterly return

3. Unidirectional Flow of invoices: There shall be unidirectional flow of invoices uploaded by the seller on anytime basis during the month which would be the valid document to avail input tax credit by the buyer. Buyer would also be able to continuously see the uploaded invoices during the month.There shall not be any need to upload the purchase invoices also. Invoices for B2B transaction shall need to use HSN at four digit level or more to achieve uniformity in the reporting system.

4. Simple Return design and easy IT interface: The B2B dealers will have to fill invoice-wise details of the outward supply made by them, based on which the system will automatically calculate his tax liability. The input tax credit will be calculated automatically by the system based on invoices uploaded by his sellers. Taxpayer shall be also given user friendly IT interface and offline IT tool to upload the invoices.

5. No automatic reversal of credit: There shall not be any automatic reversal of input tax credit from buyer on non-payment of tax by the seller. In case of default in payment of tax by the seller, recovery shall be made from the seller however reversal of credit from buyer shall also be an option available with the revenue authorities to address exceptional situations like missing dealer, closure of business by supplier or supplier not having adequate assets etc.

6. Due process for recovery and reversal: Recovery of tax or reversal of input tax credit shall be through a due process of issuing notice and order. The process would be online and automated to reduce the human interface.

7. Supplier side control: Unloading of invoices by the seller to pass input tax credit who has defaulted in payment of tax above a threshold amount shall be blocked to control misuse of input tax credit facility. Similar safeguards would be built with regard to newly registered dealers also. Analytical tools would be used to identify such transactions at the earliest and prevent loss of revenue.

8. Transition: There will be a three stage transition to the new system. Stage I shall be the present system of filing of return GSTR 3B and GSTR 1. GSTR 2 and GSTR 3 shall continue to remain suspended. Stage I will continue for a period not exceeding 6 months by which time new return software would be ready. In stage 2, the new return will have facility for invoice-wise data upload and also facility for claiming input tax credit on self declaration basis, as in case of GSTR 3B now. During this stage 2, the dealer will be constantly fed with information about gap between credit available to them as per invoices uploaded by their sellers and the provisional credit being claimed by them. After 6 months of this phase 2, the facility of provisional credit will get withdrawn and input tax credit will only be limited to the invoices uploaded by the sellers from whom the dealer has purchased goods.

9. Content of the return and implementation: Return shall be simplified also by reducing the content/information required to be filled in the return. The details of the design of the return form, business process and legal changes would be worked out by the law committee based on these principles. Government is keen to introduce the simplified return design at the earliest to reduce the compliance burden on the trade in keeping with the philosophy of ease of doing business.