Key Changes in ITR forms issued by Income Tax Department for AY20-21

The Central Board of Direct Taxes (CBDT) has notified the new Income Tax Return (ITR) forms for FY19-20/AY20-21 vide Income-Tax (12th Amendment) Rules, 2020, in line with the amendments made by the Finance Act, 2019.

Finance Minister Nirmala Sitharaman had recently extended the last date for filing of all ITRs for AY2020-21 to November 30, 2020 due to the lock-down.

Key Changes in ITR forms for the AY20-21 are as follows:

1. House Ownership: Individual taxpayers who are joint owners of house property cannot file ITR-1 or ITR-4.

2. Passport: One needs to disclose the Passport number if held by the taxpayer. This is to be furnished both in ITR-1 (Sahaj) and ITR-4 (Sugam).

3. Cash Deposit: It has been made compulsory to declare the amount deposited as cash in a bank account, if such amount exceeds Rs1 crore during the FY.

4. Foreign Travel: If the amount spent on travelling abroad exceed Rs2 lakh, you need to disclose actual amount.

5. Electricity Consumption: If the electricity bills have been more than Rs1 lakh in aggregate during the FY, you need to disclose the actual amount.

6. Investment Details: Details of Investment qualifying for deduction under chapter VIA with bifurcation of details of investment made during the period from April 1, 2020 to June 30, 2020.

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RBI 7.75% Bonds not available for investment from May 29, 2020

In its press release, the central bank (RBI) said, "The Government of India (GOI), vide notification F.No.4(28)-(W&M)/2017 dated May 27, 2020, hereby announces that 7.75% Savings (Taxable) Bonds, 2018 shall cease for subscription with effect from the close of banking business on Thursday, the 28th of May 2020".

Thus, one can invest in the RBI 7.75% bonds only by 28th May, 2020 end of banking business hours. These bonds are attractive as they offers higher rate of interest and higher degree of safety as compared to other banks fixed deposits and many other financial investment instruments.

However, the bonds have a long tenure with no premature withdrawal i.e. 7 years lock-in period for normal investors, whereas in case of senior citizens is as follows:

• 60-70 years - 6 years

• 70-80 years - 5 years

• 80 years and above - 4 years

An individual can invest as low as Rs 1,000 in these RBI taxable bonds with no maximum investment limit. An investor can opt to receive interest payments either in cumulative or non-cumulative forms.

• Under Cumulative Form: Interest (Compounded half-yearly) will be payable along with the principal amount at the end of the maturity period.

• Under Non-Cumulative Form: Interest will be payable at half-yearly intervals from the date of issue.

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NOTE: As per RBI, interest to the holders opting for non-cumulative Bonds will be paid from the date of issue up to 31st July / 31st January as the case may be, and thereafter interest will be paid half-yearly for the period ending 31st July and 31st January.

Clarification on Calamity Cess on GST

As per Article 279A(4)(f) of the constitution, the GST council has the power to levy any special rate or rates for a specific period to raise additional resources during any natural calamity or disaster.

Reports had earlier stated that the central government is considering a calamity cess on the GST during the COVID-19 pandemic, similar to flood cess @1% imposed by Kerala in June last year following the monsoon floods of 2018.

However, any such measure would further dampen the consumers' sentiment and could weaken markets' strength, especially when the government is endeavoring to boost consumption.

Also, internationally, no country has tried such imprudent fiddling with their existing tax regimes during the Covid crisis

Congress leader Kapil Sibal tweeted: "Even the RBI admits growth this year will be in negative territory. Don't even think of a calamity cess on the GST. That will be another calamity"

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CLARIFICATION

Ministry sources clarifies that in the present economic scenario during the COVID-19 pandemic, the Finance Ministry is not considering imposition of calamity cess on the GST as businesses are grappling with low sales and declining demand. Also, such proposal of introducing a calamity cess would be nothing less than an adversity itself.