Understanding the Latest Updates for Income Tax Returns (ITR) in FY 2023-2024

15 Feb Understanding the Latest Updates for Income Tax Returns (ITR) in FY 2023-2024

Posted at 12:08h in Direct Tax by
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The process of filing Income Tax Returns (ITR) undergoes regular updates, and for the Financial Year 2023-2024, significant changes have been introduced. These updates aim to simplify the filing process, enhance clarity, and adapt to the evolving financial landscape. It’s crucial for taxpayers to familiarize themselves with these updates to meet the revised requirements and improve efficiency in tax filing.

Government initiatives have introduced several key changes to streamline the tax filing process, benefiting both individuals and businesses. These changes encompass adjustments to tax slabs, updates in filing procedures for the Financial Year 2023-2024, and revised reporting requirements. Understanding these updates is essential as they can impact tax liabilities, filing deadlines, and overall compliance with tax regulations. The deadline for filing income tax returns in India varies depending on individual circumstances. This article aims to dissect the ITR updates for FY 2023-2024 and offer insights to help taxpayers navigate the updated process effectively.

Changes in ITR-1:

  • Disclosure of amounts received from retirement benefit accounts is now mandatory, covering pension funds and annuities.
  • The updated form requires disclosure of arrears or additional amounts received.
  • ITR-1 no longer allows filing returns solely for deposits exceeding Rs 1 crore in the current account.
  • Reference to Section 153C has been included in the form for returns filed in response to notifications, aiding taxpayers' understanding of legal regulations.

Changes in ITR-2:

  • Similar to ITR-1, disclosure of retirement benefit account amounts and arrears is required.
  • A new schedule for reporting profits from virtual digital assets (VDA) has been introduced.
  • SEBI registration numbers for FIIs/FPIs must now be disclosed for transparency.
  • Donations made under Section 80G require a donation reference number (ARN) for deduction.

Changes in ITR-3:

  • Disclosure of retirement account amounts and arrears is mandatory.
  • Introduction of a VDA schedule for reporting profits.
  • Addition of a 'Trading Account' section for reporting sales and income from intraday trading.
  • Disclosure of donation reference number (ARN) for deductions under Section 80G.

Changes in ITR-4:

  • Similar changes to ITR-3 regarding retirement accounts, arrears, VDA reporting, and intraday trading.
  • Requirement to report income from foreign pension funds while calculating net salary.

Changes in ITR-5, ITR-6, and ITR-7:

  • Introduction of VDA schedule for reporting profits.
  • Inclusion of a 'Trading Accounts' section for reporting sales and income from intraday trading.
  • Requirement to disclose SEBI registration numbers for FIIs/FPIs.
  • Disclosure of donation reference number (ARN) for deductions under Section 80G.
  • Provisions for reporting transfer of Tax Credit Collected at Source (TCS) to others.

In conclusion, the updates in Income Tax Returns for FY 2023-2024 aim to simplify the filing process and ensure compliance with evolving regulations. Taxpayers are advised to stay informed about these changes to fulfill their tax obligations effectively and avoid potential issues. Given the dynamic nature of tax laws, seeking expert advice may be beneficial for navigating the tax landscape successfully.

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