The Central Board of Direct Taxes (DBDT) has suggested a standardized income tax return (ITR) form in an effort to streamline the tax filing process for individuals and businesses alike. Except for Form-7, the CBDT has recommended consolidating all ITR forms. Let’s learn about the latest updates regarding a simpler and common ITR Filing form soon to be launched.
Current System of ITR Filing
Currently, taxpayers must submit income tax returns using Forms ITR-1 through ITR-7, depending on their individual circumstances and the nature of their income. It takes more time to file ITRs now since they are defined documents that taxpayers must go through in their whole, regardless of whether or not any given schedule applies to their situation.
CBDT on Common ITR Filing
The CBDT issued the following statement on the proposed standardized ITR form: “The method for submitting returns is reviewed in the newly drafted ITR to ensure it is consistent with international standards. It suggests introducing a single ITR by consolidating all the current income returns other than ITR-7. ITR-1 and ITR-4 will remain operational as they are now. This means those taxpayers can choose between using the current form (ITR-1 or ITR-4) or the planned common ITR when submitting their returns.”
Important Key Points of proposed common ITR forms
- The Basic Information Schedule (including Parts A through E), the Total Income Schedule, the Tax Schedule, the Bank Account Details Schedule, and the Tax Payment Schedule (Parts F through H) are required of all taxpayers.
- Depending on the taxpayer’s responses to a series of questions, the ITR and any attached schedules will be tailored according to their situation.
- If a taxpayer responds “no” to one question, they will not see the subsequent questions in the series.
- Additional filing instructions pertaining to the relevant schedules have been included to facilitate the filing of the return.
- The suggested ITR has been formatted so that each row only ever includes a single value. The ITR Filing procedure will be easier to complete because of this.
- When the ITR utility is released, it will be implemented such that just the relevant fields of the schedule are displayed, and when required, the same set of information will be displayed many times.
In conclusion, The government has simplified the ITR process by having certain information pre-filled. Once the Department releases the utility, the entire extent to which this will streamline the tax filing process will be revealed.
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