Major changes introduced in ITR 2 for AY 2019-20

• Given that ITR-1 is not applicable for the RNORs and the non-residents, they have to necessarily go with ITR-2 for filing their return of income
• The applicability of ITR-2 has been made more clear in as much as now it is applicable for individuals and HUF having income other than income under the head “Profits and Gains from Business or Profession”
• The field for residential status has been categorised into “Residential status in India (for Individuals)” and “Residential status in India (for HUF)”.In case of “Residential status in India (for Individuals)”, the 3 sub-categories – “Resident”, “Resident but not Ordinarily Resident’ and “Non-resident”, have been mentioned requiring the individual to tick the specific category to which they belong. Taxpayers have to mention the number of days of residency in India.Further, in the case of non-resident, an individual is also required to specify the jurisdiction(s) of residence during the previous year providing the Taxpayer Identification Number(s) of the relevant jurisdictions. Also, in case the individual is a Citizen of India or a Person of Indian Origin (PIO), the duration of stay in India during the previous year (in days) and the duration of stay in India during the 4 preceding years (in days).
• In a case where the ITR is filed by a representative assessee, additional information about the capacity of the representative assessee (by way of choice in a drop down provided) has to be given.
• An individual taxpayer has to give information about the Directorship held in any company during the previous year, also mentioning whether the shares are listed or unlisted.
• An individual taxpayer has to give information about the investment in unlisted equity shares and the movement in such investment throughout the year.
• Under income from salaries, the following details have to be provided:1. Salary as per section 17(1)2. Value of perquisites as per section 17(2)3. Profit in lieu of salary as per section 17(3)In case of salary received from more than one employer, the gross salary with the above break-up has to be provided for each such employment. From the total gross salary, the following have to be deducted:1. Allowances exempt under section 10 – details have to be specified2. Deductions under section 16
• Under income from house property, furnishing of PAN of tenant is mandatory, if tax is deducted under section 194-IB. Furnishing of TAN of tenant is mandatory if tax is deducted under section 194-I.
• In case of short-term or long term capital gains from sale of land or building or both, the details of the buyer(s) i.e. name, PAN, percentage share of ownership and address have to be given. PAN has to be mandatorily given in case of TDS under section 194-IA or when PAN is quoted by buyer in the documents.
• Interest income in the nature of pass through income has to be disclosed under “Income from other sources”.
• Information about accrual/ receipt of income from other sources on a quarterly basis regarding dividend income and income by way of lotteries, crossword puzzles, races, games etc. for the purpose of calculation of interest under section 234C.
• Under the carried forward and set off of loss: Categorization of income short term and long term capital gains taxed at special rates in India as per DTAA and net income from other sources chargeable at applicable rates.
• Introduction of section 80TTB deduction for senior citizen.
  Bifurcation of donation qualifying for deduction under section 80G into cash and other mode.
• Details of donations for scientific research and development under section 80GGA with details of name, address, PAN, cash and other mode of donation and eligible amount.
• Schedule AMT – computation of Alternate minimum tax payable under section 115JC and Schedule AMTC – computation of tax credit under section 115JD is introduced.
• While disclosing income of specified persons under schedule SPI, the “Nature of income” is replaced with “Head of income”.
• Under Schedule SI, the following incomes charged at special rates are added:1. Short term and long term capital gains2. Any other income chargeable at special rates3. Other sources of income chargeable at special rates4. Other sources of income chargeable at special rates in India as per DTAA5. Pass through income in the nature of long term and short term capital gains6. through income in the nature of income from other sources
• Under Schedule EI, following disclosures are required in case of agricultural income exceeds Rs. 5 Lakhs:
  • Name of district along with pin code in which agricultural land is located
  • Measurement of agricultural land in Acre
  • Whether the agricultural land is owned or held on lease (drop down to be provided)
  • Whether the agricultural land is irrigated or rain-fed (drop down to be provided)
  • Above disclosure to be provided separately for each agricultural land
  • Under Schedule EI, information about income not chargeable to tax as per DTAA giving details such as amount and nature of income, country name and code, Article of DTAA, Head of income and whether TRC obtained.
  • Details of pass-through income not chargeable to tax.
  • Under schedule FA, under the details of foreign assets and income from any source outside India below details are required:
    • Details of Foreign Depository Accounts held (including any beneficial interest) at any time during the relevant accounting period
    • Details of Foreign Custodial Accounts held (including any beneficial interest) at any time during the relevant accounting period
    • Details of Foreign Equity and Debt Interest held (including any beneficial interest) in any entity at any time during the relevant accounting period
    • Details of Foreign Cash Value Insurance Contract or Annuity Contract held (including any beneficial interest) at any time during the relevant accounting period
      In Schedule (Part B-TTI), Introduction of computation of tax payable under section 115JC for comparison purposes.
      Additional information in Schedule TDS giving details about the head of income and Gross income, in the case of income for which TDS credit is claimed.

Major changes introduced in ITR 2 for AY 2018-19

• The applicability of ITR-2 has been made more clear in as much as now it is applicable for individuals and HUF having income other than income under the head “Profits and Gains from Business or Profession”.
• The field of “Profits and Gains from Business or Profession” which was earlier featuring under Part B – TI has now been removed.
• Following this, Schedule-IF (Income from Firm) and Schedule-BP have also been removed. This now means, anyone earning income from a partnership firm, now has to file ITR-3 and not ITR-2.
• Additionally, under Schedule AL, the field pertaining to “Interest held in the assets of a firm or association of persons (AOP) as a partner or member thereof” has been done away with.
• This means, a partner in a firm who could file his return in ITR 2 until AY 2017-18 (specifically made available in ITR -2 for AY 2017-18) has to now file his return in ITR 3 form AY 2018-19 onwards.
• Similar to ITR-1, even in ITR-2, under the Schedule on TDS, there is an additional field for furnishing details of TDS as per Form 26QC for TDS made on rent. Also, provision for quoting of PAN of Tenant for such rent cases has also been made.