The deadline for filing the income tax returns will finally end on December 31, 2021. The Income Tax Department is continuously sending reminders via emails and text messages to make sure that returns are filed at their earliest. It has announced certain changes that are important for the taxpayers to follow for any further hindrance while filing it. As per the reports, 4.86 crore ITRs have been filed on the new e-filing portal of the income tax department on December 28, 2021.
Data analytics is used by the tax authorities to reduce time and to automate it so that there is a seamless data transfer between the Income Tax Department, the indirect tax department, including GST, customs, and other regulators. The income tax portal is fully digitized for quick access to data by the tax authorities and a user-friendly electronic platform for the assessees.
Here is all you need to know about the 5 important changes made by the income tax department:
1. Annual Information Return (AIR):
This statement is issued for gathering details of high-value transactions.
This helps in keeping track of the unusual transactions that are monitored by tax authorities.
2. ITR 1 with Quarterly breakup of Dividend Income:
Under section 234C, there is a calculation to be made for the quarterly-wise breakup in ITR forms i.e., interest to be paid for having a default in payment of advance tax liability.
Therefore, the IT department has come up with an amended form that helps the taxpayers to file returns in ITR-1.
Finally, the taxpayers will be provided with a quarterly breakup of dividend income earned during the year.
3. If the tax on ESOPs is deferred, ITR 1 and ITR 4 cannot be filed:
Rule 12 of the income tax returns has been amended along with ITR-1 and ITR-4.
The taxpayer, in case of delay in payment or tax deduction with respect to the ESOPs assigned under start-ups under section 80-IAC, is not eligible to provide the return of income on ITR-1 and ITR-4.
4. Increase in threshold limit for tax audit:
According to the Finance Act 2020, the ceiling limit had an upliftment from Rs 1 crore to Rs 5 crores.
Further, it increased to an amount of Rs 10 crores.
The necessary changes were made to improve the threshold limit for tax audits.
5. Reporting of Deferred Amount in respect of ESOPs:
In the scenario like an employee receiving ESOPs being allotted by a start-up under the provision of Section 80-IAC is postponed.
In this regard, part B of Schedule TTI needs to report the amount of deferred tax.