Common ITR Form: In a big move that could benefit crore of taxpayers, a proposal has been sent to the Finance Ministry asking it to come out with a common income tax return form. A parliamentary panel on Thursday requested the ministry to expeditiously launch such a form to ease ITR filing.
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The proposed common ITR form is expected to bring ease of filing returns to individuals and non-business type taxpayers considerably. Further, it has been suggested that all the existing forms be merged except ITR-7 to make the common income tax return form.
“The committee would expect the ministry to expedite the process and introduce the new format at the earliest,” it said.
Common ITR Form
Notably, the Central Board of Direct Taxes (CBDT) in November 2022 proposed a common income tax return form that aims to replace six of the seven existing ITR forms — ITR 1 to ITR 6. This will give an option to such taxpayers to file the return either in the existing form (ITR-1 or ITR-4), or the proposed common ITR, at their convenience, the tax body had said.
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The finance minister had invited stakeholder comments on the same.
The Standing Committee on Finance, chaired by BJP MP Jayant Sinha, had earlier flagged difficulties being faced by people in filing Income Tax returns and urged the tax department to make the process simpler and more taxpayer friendly.
It had said that any person with income from various sources, like salary, rent and business income, cannot file ITR on his own and has to seek advice of either a chartered accountant or a person having adequate knowledge and expertise in filing ITR.
In reply to the recommendations of the committee, the ministry has stated that in order to make tax compliance more convenient, pre-filled details of certain income, like salary, are being provided to individual taxpayers. The scope of information for pre-filing is being further expanded by including information like house property income, bank interest, dividends.
For the common ITR form, it has been proposed that the common form be made in tandem with international best practices by merging all existing forms except ITR-7. In addition, it is expected that the proposed form will bring ease of filing returns to individuals and non-business taxpayers.
