Filing income tax return is not only mandatory, but it should also be a responsibility of each one of us as a citizen of the country. For filing the tax returns, it is very important to know which ITR form should one file according to his income and his profession. ITR 5 Form is one of the tax return forms that are to be used by specific parties.
Form ITR 5 is an income tax return form that can be used by person being an AOL, LLPs, BOI, firm, artificial juridical person referred to in section 2(31)(vii), persons referred to in section 160(1)(iii) or (iv), registered societies, local authority and cooperative society.
If a person is required to file tax return u/s 139(4A) or u/s 139(4B) or u/s 139(4C) or u/s 139(4D) or u/s 139(4F), he shall not use form ITR 5.
The form should not be used by people if they are:
[ Read: Which ITR to File? ]
Taxpayers who earn more than Rs 5 lakh and pay taxes have to furnish their ITR by online and offline mode. To submit their ITR 5 form, taxpayers can use either offline option or the online one. For taxpayers whose accounts are liable to audit u/s 44AB, it is mandatory that the return is filed online under the digital signature.
Taxpayers can also file the ITR by transmitting the data in the tax return electronically and then submit the verification of the return in the ITR-V of the Return Form. However, in this case, the taxpayer has to print two copies of the ITR-V. One copy of the ITR-V has to be duly signed and sent by ordinary post to CPC Bengaluru while the other copy can be retained by the taxpayer to keep a record.
[ Read: Guide on Sending ITR-V to CPC Banglore ]
The ITR form 5 has been divided into two parts and various schedules that the tax filer has to understand and fill appropriately.
Part A: Basic/ General Information
It has five sub-divisions as follows:
Part B: This part seeks information of the total income and tax liability of the taxpayer.
It has two sub-divisions as given below:
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|Schedule – BA||Bank account details|
|Schedule-HP||Calculation of income under the head Income from House Property|
|Schedule-BP||Calculation of income under the head “profit and gains from business or profession.”|
|Schedule-DPM||Calculation of depreciation on plant and machinery under the Income-tax Act|
|Schedule DOA||Calculation of Depreciation on other assets under the Income-tax Act|
|Schedule DEP||Summary of depreciation on all the assets under the Income-tax Act|
|Schedule DCG||Calculation of deemed capital gains on sale of depreciable assets|
|Schedule ESR||Deduction under section 35 (expenditure on scientific research)|
|Schedule-CG||Calculation of income under the head Capital gains|
|Schedule-OS||Calculation of income under the head Income from other sources|
|Schedule-CYLA||Statement of income after set off of current year’s losses|
|Schedule-BFLA||Statement of income after set off of unabsorbed loss brought forward from earlier years|
|Schedule-CFL||Statement of losses to be carried forward to future years|
|Schedule-10A||Calculation of deduction under section 10A|
|Schedule-10AA||Calculation of deduction under section 10AA|
|Schedule-10B||Calculation of deduction under section 10B|
|Schedule-10BA||Calculation of deduction under section 10BA|
|Schedule-80G||Details of donation entitled for deduction under section 80G|
|Schedule-80IA||Calculation of deduction under section 80IA|
|Schedule-80IB||Calculation of deduction under section 80IB|
|Schedule- 80IC/ 80-ID/ 80-IE||Calculation of deduction under section 80IC/ 80-ID/ 80-IE|
|Schedule-VIA||Statement of deductions (from total income) under Chapter VIA|
|Schedule-SI||Statement of income which is chargeable to tax at special rates|
|Schedule-EI||Statement of Income not included in total income (exempt incomes)|
|Schedule-IT||Statement of payment of advance tax and tax on self-assessment|
|Schedule-TDS2||Statement of tax deducted at source on income other than salary|
|Schedule-TCS||Statement of tax collected at source|
|Changes in ITR 5||Details|
|Penalty for late filing of ITR||A new field has been added where the late filers need to provide the details of late filing fees paid.|
|Capital gains as a result of transfer of unquoted shares||A new filed has been added for the taxpayers to provide information on unquoted shares in accordance with the amendment in the section 50CA of the Finance Act, 2017.|
|Reporting gifts||A field has been added to report the amount taxable as gift.|
|Revised depreciation schedule||Depreciation schedule has been revised as per which, the highest rate of depreciation for any block cannot exceed 40%.|
|Claiming proportionate depreciation||A new field has been added to report the claim of proportionate depreciation in the event of business reorganisation, i.e. demerger, amalgamation, etc.|
|Changes in Schedule PL||Schedule PL has been modified for the taxpayers to provide GST related details|
|Credit of refund to foreign bank account||A field has been added where an NRI taxpayer can provide the details of a foreign bank account in which he wants the credit of the tax refund he wants to claim.|
|Reporting disallowance of expenses||A new field has been added to report disallowance of expenses in case of TDS default.|
|Claiming credit of TDS deducted on the name of another person||A new field has been added to facilitate the claim for TDS credit where the TDS was deducted in the name of another person or from a common pool or other similar situations.|
|Claiming relief under DTAA||The form now asks the taxpayer claiming relief as per DTAA to report more details like rate as per treaty, rate as per I-T Act and applicable rate etc.|
|Claiming exemption on capital gains||The taxpayers now need to provide more details in the form if they are claiming capital gains exemption.|
|Reporting remission or cessation of trading liability||New forms require separate reporting of remission or cessation of trading liability in case of income from other sources.|
|Reporting GST payments and refunds||New columns have been introduced in the ITR forms to report the details of GST paid and refunded.|
All these changes have been made by the tax department in the ITR form are aimed at making the assessment procedure online. Therefore, we can see that the department is seeking more and more information from the taxpayers to facilitate e-assessment.
There are three categories of defect for which validation process is to be carried out at the e-filing or CPC end in ITR 5.
Let’s look at the categories of the defect and the action that is to be taken during the validation process:
|Category of Defect||Action to be taken|
|A||Return will not be allowed to be uploaded, and an error message will be displayed|
|B||Return data will be allowed to be uploaded, but the taxpayer will be notified of a possible defect present in the tax return u/s 139(9). Appropriate communications or notices will be issued from CPC Bengaluru.|
|C||The third party utility providers will be signalled about the unstable quality of the data, and they will be warned about the future prohibition of the utility.|
This form needs to be filed in a particular sequence. This sequence has to be as follows:
If you still haven’t filed your Income Tax Return, you are at the right place. File your ITR 5 form with H&R Block to experience effective and hassle-free tax filing. Our tax experts will file your return for you while you sit back and concentrate on your work.