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New ITR Forms AY 2017-18 (FY 2016-17) : Which ITR Form should you file?

The introduction of the new ITR form AY 2017 – 2018 was introduced by the central board of direct taxes. The new form comes with certain changes that aims to make the filing of the income tax return easier for the people, for the financial year 2016 – 2017.

The introduction of the new ITR form has been made available in PDF version, however the government authority is looking forward to launch the JAVA and excel utility verion AY 2017 – 18 soon for the people. This AY 2017 – 2018 version will be available online on the income tax e-filing website.

AY and FY : Assessment Year and Financial Year

FY is the financial year during which a person earns the income. For example if we are submitting tax file return this year, we are doing that for the previous financial year.

AY is the assessment year for the income tax or the year of income tax return filing year. For example if we are paying the tax for financial year 1^st April to 31^st March we need to submit our income tax return file within 31^st July 2017, this filing date falls under the assessment year or AY 2017.

Income Tax Slabs & Rates for FY 2016-17 (AY 2017-18)

Below are the income tax rate for FY 2016 – 2017 to filed return in the AY 2017 – 2018.

Introduction to ITR filing and new ITR forms AY 2017 – 2018.

Which ITR form is to be used for filing return?

Below mentioned are details of the various new ITR forms available in the PDF format available to people for submitting Income tax return file.

The previously available ITR form was 9, the number of the ITR form has been reduced by the government to seven forms.

Government of India has made it mandatory to announce Aadhaar number, Aadhaar enrollment ID and also the announcement of cash deposit that has been made above the amount of Rs 2 lakhs during the time of demonetization between the period of November 9^th 2016 and December 30^th 2016. However the announcement of Aadhaar number, Aadhaar enrollment ID is not compulsory for Non residential Indian citizens. Further the announcement of Aadhaar number, Aadhaar enrollment ID is not compulsory for people who are not citizens of India, and for people who are above the age of 80 years old. It is also not mandatory for people of Jammu and Kashmir, Meghalaya, and Assam to quote their Aadhaar number, Aadhaar enrollment ID during Income Tax filing return.

The already available ITR forms ITR-2, ITR-2A and ITR-3 has been merged together into ITR form 2 and the same has been notified in place of these 3 available forms.

The already available ITR form ITR 4 has been changed to ITR form ITR 3.

Further ITR 4S sugam has now been changed to ITR 4.

It has been mentioned by the government of India that all ITR forms needed to be submitted electronically. However the only exception being for citizen above 80 years of age, and whose income does not exceed Rs 5,00,000 in a financial year. Only in this issue, citizen’s who have not filed any return for the financial year can submit their Income tax return file in paper form.

New ITR 1 Sahaj form for assessment year 2017 – 2018

The already existing multiple pages ITR 1 form has been reduced to a one page ITR form.

ITR form 1 Sahaj can be used by the people to submit tax file return for income up to Rs 50,00,000 which might include salary, one house property and income from any other interest.

ITR form 1 Sahaj has all the various tax deduction sections mentioned on it like section 80C, 80D, 80G and 80TTA. However in case any further section that may be taken into consideration for calculating tax deduction of a person, the same can be mentioned by the person on the form itself with detail about the amount to be deducted and under which section that needed to be considered.

In case if a person income is Rs 2,50,000 or more from LTCG it is compulsory for the person to file e-filing tax return even if the persons total taxable income is below 2.5 lakhs.

Further introduction of a separate provision has been made to announce any LTCG or long term capital gain, so that this amount may be exempted from income tax under section 10 (38).

Additional introduction of a seperate provision has been made to announce any dividend income received from an Indian company as the same money will be exempted from income tax under section 10 (34).

New ITR form 2 for assessment year 2017 – 2018

The new ITR form ITR 2 can be used in filing income tax return by any individual or HUF ” hindu undivided family”. The usage of this form can be made in case of the following criteria’s.

Income from pension or salary.
Income from capital gains.
Income made from multiple houses.
Professional income made from working under any proprietorship, but this cannot be the business of the individual.
If anyone holds any asset outside India in any foreign country, or the income of the individual comes from any other source beyond the boundaries of India.
Income from agriculture exceeding Rs 5000.
Income made from winning of lottery or betting in a horse race.
If a person’s income exceed Rs 5,00,000 in a financial year, a schedule AL is there on ITR form ITR 2 where the details about the assets and liabilities needed to be mentioned for the financial year for the said assessee.

New ITR form 3 for assessment year 2017 – 2018

The available ITR form ITR 4 has been changed to ITR form ITR 3.

The new ITR 3 form is for individual or hindu undivided family with income source from business venture or income source from professional service rendered or partnership firm.

This ITR for includes all kind of incomes that can be made by any individual or a hindu undivided family irrespective of the amount gained in the financial year. Under this form a person can also announce his income made from any salary, or multiple assets like houses, gains from lottery tickets or betting on horse race, any capital gain and any other speculative income that a person can have in a financial year other than his business income. A person can announce all these additional income together with his business income under ITR form ITR 3.

New ITR form 4 Sugam for assessment year 2017 – 2018

This form is meant for the following people to file income tax return :

Income made from business or profession by an individual that may be presumptive in nature.
The individual does not have any income from capital gain.
The net income of the person from agriculture is below Rs 5000.
The person does not his earning from source outside the country, or the individual does not have any asset beyond the boundaries of India.
The person earns from a single house or property.
The person has other income sources.

These are the points we should keep in mind while filing tax return for AY 2017 – 2018.