Government Notifies Changes In ITR-1, ITR-4 Forms For AY 2020-21

Individual taxpayers who own a house jointly and paid Rs 1 lakh in electricity bills in a year or spent Rs 2 lakh on foreign travel cannot file their annual income tax returns using the simple ITR-1 form.

The central government, which usually notifies forms for filing income tax returns by individuals in April every year, notified on Jan. 3 ITR forms for assessment year 2020-21 (income earning year April 1, 2019 to March 31, 2020).

Returns in ITR-1 Sahaj can be filed by an ordinary resident individual whose total income does not exceed Rs 50 lakh, while Form ITR-4 Sugam is meant for resident individuals, Hindu Undivided Families and firms (other than LLP) having a total income of up to Rs 50 lakh and having presumptive income from business and profession.

According to the notification, two major changes in the ITR forms have been effected. First, an individual taxpayer cannot file returns either in ITR-1 or ITR-4 if he is a joint-owner in house property.

Second, ITR-1 form is not valid for those individuals who have deposited more than Rs 1 crore in bank account or have incurred Rs 2 lakh or Rs 1 lakh on foreign travel or electricity, respectively, it said.

Such taxpayers will have to use different forms, which will be notified in due course.

An individual who "owns a house property in joint ownership with two or more persons" is required to furnish a return of income, the notification said.

"Only the forms have been notified without the return filing utility. Thus, a taxpayer, who is required to file the return before the previous year ends, cannot do so until the return filing facility is activated on the e-filing portal," said Naveen Wadhwa of Taxmann.

Usually, the Income Tax Department notifies the ITR forms in the first week of April of the relevant assessment year. However, in contrast to the old practice, it has notified two ITR forms ITR-1 and ITR-4 for AY 2020-21 in the first week of January.