The government of India has finally released the first Income Tax return form for FY 2019-20 (AY 2020-21) and the released form is ITR 1.
In this article, we will talk about the eligibility of filing ITR 1 and key changes in the newly launched form.
Who can opt to file ITR 1 and who can not go for ITR 1
|Who should file ITR 1||Who should not file ITR 1|
|Resident Individual||Non Resident individual or an assessee other than Individual|
|Having Total Income upto Rs.50 lakhs||Having Total Income above Rs.50 lakhs|
|Having Income from Salaries, One House Property, Other Sources (Interest, etc.)||Having Income from Capital Gaina, more than One House Property and from Business and Profession|
|Having Agricultural Income upto Rs.5 thousand||Having Agricultural Income above Rs.5 thousand|
|Any Individual who is neither Director in a company nor has invested in Unlisted Equity Shares)||Any Individual who is either Director in a company or has invested in Unlisted Equity Shares)|
|Who does not have excess House property loss to carry forward in next year||Who have excess House property loss to carry forward in next year|
Key Changes in FY 2019-20 (AY 2020-21)
Addition of new employer category: Till last year we had only ”Government” in the nature of employment but this year ITR has come up with two different categories “Central Government” & “State Government”.The screen of new Categories attached for your reference.
Introduction of Seventh Proviso to section 139(1) in ITR 1: This year ITR 1 has an entirely new section return filing under the seventh proviso to section 139(1).
The said proviso has been inserted by Budget 2019 applicable from FY 2019-20 (AY 2020-21), where the revenue authority has put in some additional condition to file an income tax return even if your total income is below the minimum taxable limit that is 2.50 lakhs.
Following are the condition introduced by the seventh proviso to section 139(1), where you have to file a return even if you don’t have the taxable income.
- If a person have deposited an amount or aggregate of the amounts exceeding Rs.1 crore in one or more current account during the previous year
- If a person has incurred an expenditure of an amount or aggregate of the amounts exceeding Rs. 2 lakhs for himself or any other person for travel to a foreign country;
- If a person has incurred an expenditure of an amount or aggregate of the amounts exceeding Rs. 1 lakh towards consumption of electricity
Any individual falling in any of the above three categories have to file an Income tax return even if you have no income or non-taxable income.
Step 1. You have to first confirm that re you covered by the seventh proviso to section 139(1)
Step 2. At this step, you have to select under which condition of the seventh proviso to section 139(1) you get covered.
Step 3. At last, you have to give the amount of deposit/expenditure made bu you during the Financial Year 2019-20.
Note: If you are required to file an income Tax return under the normal provision of Income Tax Act then you need not require to fill the details required under the seventh proviso to section 139(1)in your ITR form.
Introduction of New Schedule 80DI: With the outbreak of the Corona Virus all over the world, many lifes got disrupted. Lockdown has been implemented to contain its spread and the government is aware of the fact that during this lockdown period it is almost impossible to fulfill the entire compliance requirement on time and in order to provide relief to taxpayers, the Finance Ministry has made some announcements to ease the pressure of compliance. One of them was “The time limit for making investments to claim a deduction for FY 2019-20 which was on 31st March 2020 has been extended to 30th June 2020. It means you can claim a deduction for investments made upto 30th June 2020 in FY 2019-20”.
Now the government in income tax return form wants details of investment made by the assessee during April 20 – June 20 and deduction is being claimed in FY 2019-20. The screen of the new schedule has been attached for your reference.
Introduction of separate Schedule for section 80D:
Section 80D: This section provides a deduction for the medical insurance paid, health checkup expenses, and medical expenditure (Senior citizen) by an individual for himself, his family, or for his parents.
Section 80D Deduction Chart
|Covered Person||Category||Health Insurance||Medical Checkup||Medical Expenditure||Aggregate (Maximum Allowed)|
|Self and Family||Non-Senior Citizen||25000||5000||0||25000|
|Self and Family||Senior Citizen||25000||5000||50000||50000|
|Self and Family + Parents||Both Non-Senior Citizen||50000||5000||0||50000|
|Self and Family + Parents||Parents (Senior Citizen)||75000||5000||50000 (Parents)||75000|
|Self and Family + Parents||Both (Senior Citizen)||100000||5000||50000||100000|
Till Financial Year 2019-20, there was no requirement to give bifurcated details for insurance/medical expenditure incurred by you on yourself, your family or your parents but Financial Year 2019-20 is asking for the detailed bifurcation of insurance/medical expenditure incurred by you on yourself, your family or your parents. The newly added schedule has been added for your reference.