Govt simplifies IT return forms, extends last day to Aug 31

Finance Ministry does away with disclosures with regards to foreign trips and dormant bank accounts

The Finance Ministry on Sunday decided to simplify the Income-tax return forms, but retained the clauses that were meant to curb tax evasion.

The ministry had come under severe criticism over the earlier forms released in April, which were termed as complex and onerous by tax payers and experts.

The 14-page form sought extensive details on foreign trips, bank balance and capital gains. Finance Minister Arun Jaitely had later announced that the return forms would be withdrawn and replaced with simpler ones.

Now, a taxpayer will not have to disclose details of all foreign travels and expenses incurred thereon, but he will have to give his passport numbers in the revised form. Besides, taxpayers will not have to mention the balance in their bank accounts but will have to disclose all their accounts.

 

“‎The government has taken steps in line with the intent of simplifying the tax forms. Importantly, they have removed the requirement of including foreign trip expenditure details in the return forms for residents. They have also simplified the requirement with respect to bank account details - now just the IFSC code suffices. All these steps are heartening. But to understand the fine print, we will have to wait for the final forms that are to be notified. The efiling version is expected in three weeks,” said Tapti Ghose, partner, Deloitte Haskin and Sells.

As per a Finance Ministry release, a new form ITR 2A has been brought out by which can be filed by an individual who does not have capital gains, income from business/ profession or foreign asset/foreign income.

With the e-filing return forms expected to be released only by the third week of June, the government also extended the last date for filing of returns to August end from July end.

The disclosures on bank accounts have also been relaxed. Now, the income tax payer will not have to disclose details about accounts dormant for the past three years. While taxpayers will have to give details about their bank accounts including the IFS code and the account number for all the current and savings account held by them at any time during the previous year. 

The new return forms also made life easier for expats and non-resident Indians (NRIs) which in earlier forms would have been subjected to reporting of their foreign assets.

“An individual who is not an Indian citizen and is in India on a business, employment or student visa (expatriate), would not mandatorily be required to report the foreign assets acquired by him during the previous years in which he was a non-resident if no income is derived from such assets during the relevant previous year,” the government said.

However, the disclosures of foreign assets have been retained as a precursor to the Undisclosed Foreign Assets and Income Bill (black money Bill), and to help check tax evasion.