Key changes notified in the ITR forms the Asst Year 2020-21

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The Central Board of Direct Taxes (CBDT) has notified new Income-tax Return (ITR) forms applicable for the Assessment Year 2020-21.

CBDT notified Income Tax Return forms of FY 2020-21

G.S.R. 338(E).— In exercise of the powers conferred by section 139 read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes has made the rules to amend the Income-tax Rules, 1962.

The principal rules were published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii) vide notification number S.O. 969(E), dated the 26th March, 1962 and last amended by the Income-tax (11th Amendment) Rules, 2020, vide notification number G.S.R. 329 (E) dated 28.5.2020.

In essence, the following are the key changes:

  1. House ownership: Individual taxpayers who are joint owners of house property cannot file ITR 1 or ITR4.
  1. Passport: One needs to disclose the Passport number if held by the taxpayer. This is to be furnished both in ITR 1-Sahaj and ITR 4-Sugam. Hopefully, it will be made mandatory in other ITR Forms as and when they are notified.
  1. Cash deposit: For those filing ITR 4-Sugam, it has been made compulsory to declare the amount deposited as cash in a bank account, if such amount exceeds Rs 1 crore during the FY.
  1. Foreign travel: If you have spent more than Rs 2 lakh on travelling abroad during the FY, you need to disclose the actual amount spent.
  1. Electricity consumption: If your electricity bills have been more than Rs 1 lakh in aggregate during the FY, you need to disclose the actual amount.
  1. Investment details: Details of investment qualifying for deduction under chapter VIA with bifurcation of details of investment made during the period from April 1, 2020 to June 30, 2020.
  2. A new schedule ‘Schedule DI’ has been inserted to claim benefit of investment/ deposit/payments made between 01-04-2020 to 30-06-2020 for the previous year 2019-20.

Download the ITR Forms for Asst Year 2020-21

MCA has extended the period for names reserved and re-submission of forms

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Ministry of Corporate Affairs ( MCA ) has extended the period for names reserved and re-submission of forms.

Issue description and Period/Days of Extension are as below: –

Names reserved for 20 days for new company incorporation.

SPICe+ Part B needs to be filed within 20 days of name reservation

  1. Names expiring any day between 15th March 2020 to 31st May would be extended by 20 days beyond 31st May 2020.
  2. Names reserved for 60 days for change of name of company. INC-24 needs to be filed within 60 days of name reservation.
    Names expiring any day between 15th March 2020 to 31st May would be extended by 60 days beyond 31st May 2020.
  3. Extension of RSUB validity for companies.
    SRNs where last date of Resubmission (RSUB) falls between 15th March 2020 to 31st May 2020, additional 15 days beyond 31st May 2020 would be allowed. However, for SRNs already marked under NTBR, extension would be provided on case to case basis.
    Note: Forms will not get marked to (Not to be taken on Record)’NTBR’ due to non-resubmission during this extended period as detailed above. It also includes IEPF Non-STP eForms ( IEPF3, IEPF-5 and IEPF-7)
  4. Names reserved for 90 days for new LLP incorporation/change of name. FiLLiP/Form 5 needs to be filed within 90 days of name reservation.
    Names expiring any day between 15th March 2020 to 31st May would be extended by 20 days beyond 31st May 2020.
  5. RSUB validity extension for LLPs.
    SRNs where last date of resubmission (RSUB) falls between 15th March 2020 to 31st May 2020, additional 15 days would be allowed from 31st May 2020 for resubmission. However, for SRNs already marked under NTBR, extension would be provided on case to case basis.
    Note: Forms will not get marked to (Not to be taken on Record)’NTBR’ due to non-resubmission during this extended period as detailed above.
  6. Extension for marking IEPF-5 SRNs to ‘Pending for Rejection u/r 7(3)’ and ‘Pending for Rejection u/r 7(7)’
    SRNs where last date of filing eVerification Report (for both Normal as well as Resubmission filing) falls between 15th March 2020 to 31st May 2020, would be allowed to file the form till 30th Sep 2020. However, for SRNs already marked under ‘Pending for Rejection u/r 7(3)’ and ‘Pending for Rejection u/r 7(7)’, the extension would be provided on case to case basis.

Note: Status of IEPF-5 SRN will not change to ‘Pending for Rejection u/r 7(3)’ and ‘Pending for rejection u/r 7(7)’ till 30th Sep’20.

Notification by MCA of Extension of time_22042020  

CBDT Defers Requirement of Registration of Charitable, Religious Trusts by 4 Months Till October 1

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Earlier, such registrations/approvals were granted without any specific expiry period unless specifically withdrawn by concerned tax authority. Under the new law introduced by Finance Act 2020 and effective from June 1, 2020, all such registrations/ approvals would now be issued with an expiry period of 5 years.

In  a relief to religious trusts, educational institutions and other  charitable institutions, the income tax department on Friday deferred by  4 months till October 1 the requirement of registration of these  entities.

In  a relief to religious trusts, educational institutions and other  charitable institutions, the income tax department on Friday deferred by  4 months till October 1 the requirement of registration of these  entities.

“In  view of the unprecedented humanitarian and economic crisis, the CBDT  has decided that the implementation of new procedure for approval/  registration/notification of certain entities shall be deferred to 1st  October, 2020,” an official statement said.

Finance Act 2020 prescribed substantial changes in law pertaining to registration/approval of trusts and charitable institutions, whose income are exempt under section 10(23C), Section 11 or for the purpose of Section 80-G of the Act for tax deductible donations.

Earlier, such registrations/approvals were granted without any specific expiry period unless specifically withdrawn by concerned tax authority.

Under the new law introduced by Finance Act 2020 and effective from June 1, 2020, all such registrations/ approvals would now be issued with an expiry period of 5 years.

Further, all trusts/charitable institutions already having approval or registration were also supposed to file applications for renewal of there registration/approval within 3 months of new law coming into force, i.e. August 31, 2020.

Nangia Andersen Consulting Shailesh Kumar said “in light of COVID-19 outbreak and consequent lockdown, giving relief to the taxpayers, this timeline has been deferred by 4 months. Thus, new law which was supposed to come in effect from 01 June 2020 would now come in effect from 01st October 2020.

“All existing trusts/ charitable institutions would now need to file applications for renewal of their registrations/ approvals by December 31, 2020 instead of earlier August 31, 2020,” he added.

The statement said various representations were received to the finance ministry expressing concerns over the implementation of new procedure from June 1, 2020 due to outbreak of coronavirus (COVID-19) and consequent lockdown and there have been a number of requests to defer the applicability of new procedure.

“This is a welcome move and provides expected relief in light of genuine hardships created by COVID-19. The entities benefited by this circular would be religious trusts, hospitals, educational institutions or other public charitable institutions created for welfare of public and allows exemption from income tax on account of their activities and charitable purpose,” Kumar added.

Consulting firm AKM Global Tax Partner Amit Maheshwari said, “This is a welcome clarification as in the absence of this extension, it was extremely difficult to comply with these procedures. Several representations had been made on this matter and this is indeed a welcome move.”

TDS on salary and New Income Tax rates: Highlights

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• An employee can change the option of tax structure at the time of filing the ITR
• TDS will get adjusted accordingly

The Central Board of Direct Tax (CBDT) recently came out with a circular, offering clarifications for tax-paying employees on how they can migrate to the new concessional tax regime, which was announced in this year’s Union Budget.

The lower income tax rates under the new regime came to effect from April 1, 2020. However, there were many concerns raised on how employees can choose to opt between the old and regime.

In an April 13 release, the CBDT said employees, who do not have any income from a business, can opt for the new concessional tax slabs or the old regime by intimating the deductor (employer) through a declaration form.

The declaration will also help employers determine whether to deduct TDS as per the old regime or the new concessional rates.

Employees have an option to choose between the new tax regime and the old one. Experts have already said that each employee/taxpayer may opt for any of the two, based on investments.

Coming to the new slabs under the concessional tax regime, those earning Rs 2.5 lakh will have to pay no tax while people earning Rs 2.5-5 lakh will have to pay 5 per cent tax.

Individuals in the income bracket of Rs 7.5-10 lakh will pay 15 per cent tax. People earning over Rs 10-12.5 lakh will be taxed at 20 per cent and those earning Rs 12.5-15 lakh will pay 25 per cent taxes. Finally, people earning above Rs 15 lakh will pay 30 per cent tax under the concessional tax regime.

To sum up the clarifications: 1) Employees,  who do not have any income from a business, can choose to inform their employer through a declaration if they want to opt for the new tax regime for deducting tax at source on TDS from salaries.

However, employees who do not submit any declaration to the employer will continue to be charged under the old regime as earlier.

2) The IT department also clarified that an employee can change the tax structure at the time of filing income tax and that the amount of TDS will be adjusted accordingly.

“The deductor shall compute his total income, and make TDS thereon in accordance with the provisions of section IISBAC of the Act. If such intimation is not made by the employee, the employer shall make TDS without considering the provision of section 11SBAC of the Act,” the CBDT notification said.

3) Another important clarification by the tax department was related to TDS. Once employees make their intention clear to opt for the concessional rates, it will remain the same for TDS purpose for the year without any scope of modification.

“It is also clarified that the intimation so made to the deductor (employee) shall be only for the purposes of TDS during the previous year and cannot be modified during that year,” it said.

“However, the intimation would not amount to exercising an option in terms of sub-section (5) of section 115BAC of the Act and the person shall be required to do so along with the return to be furnished under sub-section (1) of section 139 of the Act for that previous year. Thus, option at the time of filing of return of income under sub-section (1) of Section 139 of the Act could be different from the intimation made by such employee to the employer for that previous year.”

Companies Fresh Start Scheme, 2020 (CFSS-2020)

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The Ministry of Corporate Affairs has introduced the “Companies Fresh Start Scheme, 2020” and revised the “LLP Settlement Scheme, 2020” which is already in vogue to provide a first of its kind opportunity to both companies and LLPs to make good any filing related defaults, irrespective of the duration of default, and make a fresh start as a fully compliant entity.

The Fresh Start scheme and modified LLP Settlement Scheme provide relief to law abiding companies and the Limited Liability Partnerships (LLPs) amid COVID-19 pandemic.

One Time Opportunity

The USP of both the schemes is a one-time waiver of additional filing fees for delayed filings by the companies or LLPs with the Registrar of Companies during the currency of the Schemes, i.e. during the period starting from 1st April 2020 and ending on 30th September 2020.

Fee Payable for CFSS

Only normal fees for filing of documents in the MCA-21 registry will be payable in such case during the currency or CFSS-2020. There will not be any additional fee for any documents.

Every defaulting company  shall be required to pay normal fees as prescribed under the Companies (Registration Offices and FCC) Rules, 2014 on the date of filing of each belated document and no additional fee shall be payable.

Dormant Company

The scheme gives an opportunity to inactive companies to get their companies declared as ‘dormant company’ under Section 455 of the Act by filing a simple application at a normal fee.

Details of CFSS 2020

The scheme shall come into force on the 01.04.2020 and shall remain in force till 30.09.2020

  1. “Defaulting company” means company defined under the  Companies Act, 2013, and which has made default in filing of any or the documents, statement, returns, etc including annual statutory documents on the MCA-21 registry
  2.  “Immunity certificate”‘ means the certificate referred to in subparagraph (viii) of paragraph 6 of the Scheme;
  3. “Inactive Company” means a company as defined in Explanation (i) to sub-section (l) of section 455(1) of the Companies Act, 2013;

Applicability of CFSS 2020

Any ‘defaulting company’ is permitted to file belated documents which were due for filing on any given date in accordance with the provisions of this Scheme.

Immunity from the launch of prosecution or proceedings for imposing penalty shall be provided only to the extent such prosecution or the proceedings for imposing penalty under the Act pertain to any delay associated with the filings of belated documents.

The Ministry received much representation from the stakeholders to provide a one-time opportunity to file all the pending documents including the annual filing of the company without charging higher additional fees on any delay. The Scheme provides the above opportunity to the inactive company to convert into a dormant company under section 455 of Companies Act, 2013 by filing form MSC-1 with nominal fees & help the inactive companies to remain on ROCs register with minimum compliance requirements.

The defaulting company shall be required to file the belated documents including annual filing by paying nominal fees (without including Additional Fees) as per Companies (Registration Offices and Feel Rules, 2014) as prescribed under the Companies Act, on the date of filing of each belated document.

Both the Schemes also contain a provision for giving immunity from penal proceedings, including against imposition of penalties for late submissions and also provide additional time for filing appeals before the concerned Regional Directors against the imposition of penalties, if already imposed. However, the immunity is only against delayed filings in MCA 21 and not against any substantive violation of the law. 

Application for issue of immunity under the CFSS

An application for seeking immunity in respect of belated documents can be filed under the Scheme in the Form CFSS-2020, after closure of the Scheme and after the document(s) are taken on file, or on record or approved by the Designated authority as the case may be but not after the expiry of six months from the date of closure of the Scheme. There is no fee payable on this Form.

Provided also that no immunity shall provide in case any court has ordered conviction in any matter, or an order imposing penalty has been passed by an adjudicating authority under the Act and no appeal has been preferred against such orders of the court or of the adjudicating authority.

Immunity certificate under CFSS-2020

Based on the declaration made in the Form CFS-S-2020, an immunity certificate in respect of documents filed under this Scheme shall be issued by the designated authority.

Effect of immunity

After granting the immunity, the ROC office shall withdraw the prosecution(s) and the proceedings of adjudication of penalties under section 454 of the Act, if any, in respect of defaults against which immunity has been so granted and shall be deemed to have been completed without any further action.

Any other consequential proceedings, including any proceedings involving interests of any shareholder or any other person of the company for its directors or key managerial personnel, would not be covered by such Immunity. If the company appeals against any order of prosecution for penalty passed by the competent court or adjudicating authority, then the company first needs to withdraw its application of appeal and furnish the proof of withdrawal to avail immunity in this CFSS 2020 scheme.

Scheme not to apply

This scheme shall not apply

  • to companies against which action for final notice for striking off the name u/s 248 of the Act (previously section 560 of Companies Act, 1956 has already been initiated by the ROC.
  • where any application has already been filed by the companies for action of striking off the name of the company from the register of companies;
  • to companies which have amalgamated under a scheme of arrangement or compromise under the Act;
  • where applications have already been filed for obtaining Dormant Status under section 455 of the Act before this Scheme;
  • to vanishing companies;
  • Where any increase in Authorized Capital is involved (Form SH7);
  • also Charge related documents (CHG-I, CHG-A. CHG-8 and CHG-9).

The defaulting inactive companies while filing documents under CFSS-2020 can simultaneously apply for the following actions :

  1. Apply to get themselves declared as Dormant Company under section 455 of the Companies Act, 2013 by filing e-form MSC-I  at a normal fee on said form; or
  2. Apply for striking off the name of the company by filing e-Form STK-2 by paying the fee payable on form STK-2. 

39th GST Council Meeting: Highlights

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Infosys Nilekani gave GST Network presentation to Council.

Council ask Infosys to improve GST Network by July.

Filing to be mandatory for taxpayers over Rs 5cr of annual turnover

Decides to extend deadline for filing of GSTR9 & GSTR9C for FY18-19 till June 30, 2020,

GST Council to continue with 3B till September & defer the new return system.    

Council defers the proposal on taxability of economic surplus of brand owners of alcohol for human consumption,

Reassures states towards payment of compensation dues,

Where Cancellation have been cancelled till March 14, application for cancellation of revocation can be filed till March 31, 2020.

GSTR-1 to be made compulsory only for making B2B supplies, exports & amendments

B2C & non-filers of GSTR-3B to be exempted from filing GSTR-1

Before 10th for turnover greater than Rs 1.5 cr

Before 13th for turnover lesser than Rs 1.5 cr

GSTR-2A to be generated on 14th of every month

Council approves “Know your Supplier” Scheme

Major Reliefs:  

Interest for delay in GST payment will now be charged on next cash liability under Section 50, to be applicable from July 2017              

GST on mobile phones and specified parts was increased from 12% to 18%. This decision was taken to avoid difficulties due to the inverted duty structure.


All types of matches have been rationalised to a single GST rate of 12%. Till now, the handmade ones were taxed at 5% and the rest was taxed at 18%.


GST on Maintenance, Repair and Overhaul (MRO) service in respect to aircraft was reduced from 18% to 5% with full ITC.

All these rate changes will come into effect from 01 April 2020.

A new scheme called ‘Know your Supplier’ has been introduced so that the taxpayers are informed about the basic details of the suppliers with whom they transact or propose to conduct business.

30 important Key features of GST New Return System:

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First 15 features (1-15 points) as PART-I:-

  1. Supplier can upload the Tax Invoices on real time basis in Anx-1.
  1. Recipient can view his purchase Invoices on near real time basis.
  1. Recipient can also view whether supplier has filed his return or not.
  1. Supplier has to upload the Tax Invoices latest by 10th of Next Month.
  1. However, recipient can claim ITC on missing invoices also subject to certain conditions.
  1. In case, Invoice uploaded by the supplier in Anx-1, but RET-1 is not filed, uploading of invoices in Anx-1 will be treated as self-admitted liability and recovery proceedings will be initiated against the supplier, except in certain specified situations where recipient will be liable to pay.
  1. Recipient has to pay the amount of ITC availed on missing invoices after specified period. (Missing invoices means, invoices not uploaded in Anx-1)
  1. To find out missing invoices, Offline IT Tool will be provided for matching invoices in Anx-2 with invoices in the accounting system of recipient.
  1. Payment of tax shall be discharged full at the time of filing of RET-1 or SAHAJ or SUGAM itself.
  1. In case of Quarterly returns, tax shall be paid on monthly basis.
  1. Recipient can do the following actions on the invoices appearing in Anx-2 (auto drafted Purchase Invoice):

Accept  also called as locking

Reject (eg. Invoice not related to the recipient)

Pending

  1. If no action is taken on a particular invoice, it will be deemed by the system as accepted and ITC will be available against these invoices.
  1. Once invoice is accepted by the recipient, i.e., locked by the recipient, supplier cannot amend those invoices.
  1. Locked Invoice should be unlocked by the recipient only, for making any amendment by the supplier.
  1. Supplier will be able to issue Debit Note or Credit Note on locked invoices also. If credit/debit note is issued against any pending invoice, then system will club the credit/debit note with pending invoice.

Second set of 15 features (16-30 points) as PART-II:-

  1. Missing invoices shall be reported in RET-1 of the current month.
  1. System will calculate the interest automatically. Once the tax and interest is paid, the missing invoice will be clubbed with the monthly return to which it relates.
  1. For amendments, separate Return Form is available.
  1. Maximum 2 amendments return can be filed for any one month.
  1. “NIL” Return can be filed by “SMS”.
  1. Negative liability if any shall be carried forward to next month regular return.
  1. Higher late fee for amendment return if change in liability is more than 10%
  1. Shipping Bill details also should be entered in Anx-1 by the exporters.
  1. If the shipping bill details are not available by the time of filing the return, the same can be entered later on also.
  1. The export data then will be transmitted to ICEGATE portal for cross verification purposes.
  1. Until the facility is ready to pull the data from ICEGATE portal, importers can avail ITC on imports and supplies from SEZ on self-declaration basis.
  1. New concept of suspension of registration will be introduced. From the date of suspension till the date of cancellation, tax payer need not file returns and invoice uploading also will not be allowed.
  1. HSN should be reported at 4 digit level in monthly return.
  1. The tables in the return will be opened based on the profile of the tax payer.
  1. For all return obligations offline utility tools are made available to make filing process as easy as possible.