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Tax planning: Check latest changes made in ITR forms

Tax planning: Check latest changes made in ITR forms
April 08
11:29 2021

Earlier, dividend income up to Rs 10 lakh was exempt from tax under Section 10(34). Taxpayers were required to show such income under the exempt income section.

the government introduced a new concessional tax regime in FY20

the government introduced a new concessional tax regime in FY20

The tax department said no significant changes were made this year due to the coronavirus pandemic while notifying new income tax return (ITR) forms for assessment year 2021-22 (AY22).

In line with the changes in the Finance Act, 2020, there are certain tweaks that have been brought. Here are some of the Key changes you should know.

The dividend income has to be disclosed under “income from other sources”. In the Finance Act, 2020, dividends were made taxable in the hands of the taxpayers instead of dividend distribution tax to be deducted by the company or payment or declaration of dividend.

“Until AY21, only dividend income that was not exempt was required to be disclosed in the section ‘income from other sources’. Now, all types of dividend incomes are required to be disclosed here,” a tax research firm said in a Mint.

Taxpayers were required to show such income under the exempt income section. Earlier, dividend income up to Rs 10 lakh was exempted from tax under Section 10(34). The reference to dividend income up to Rs 10 lakh from a domestic firm has been removed from the exempt income section.

Under Section 115BAC, the government introduced a new concessional tax regime in FY20 that allows taxpayers the option to pay tax at lower slab rates but forgo around 70 deductions. The taxpayer is required to choose if he or she is opting for the concessional tax regime under Section 115BAC in Part A of the tax forms.

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