Tax filing season is just around the corner. ITD is gearing up for the same and it recently released utilities for ITR1, ITR2 and ITR4 for AY21-22. The utility is a software introduced by ITD which helps Taxpayers file their ITR. The ITD releases ITR utility every tax filing season with updated rules and schemas.
However, with the new Income Tax Portal being launched, it seems that there are some issues Taxpayers need to watch out for when it comes to utilities. The ITD will be resolving these small issues shortly.
Here’s what you need to keep an eye out for:
Currently, pre-filled JSON downloaded from the IT portal only includes basic information like taxpayer’s name, PAN no, Aadhar no, residential address, contact information and bank accounts. However, more comprehensive data such as heads of income (i.e Salary, Capital Gains, other sources) and tax credits (i.e TDS, Self-assessment Tax, Advance Tax) are yet to be updated.
Issues while filing ITR 4
When opting for the new Tax regime, you need to file form 10-IE before filing the ITR. Details such as the date of filing form 10-IE and its acknowledgement number need to be disclosed when filing the ITR under the new tax regime. Currently, taxpayers are unable to enter these details in the ITR 4 utility.
Error in calculating Advance Tax interest u/s 234C
In case, you missed paying Advance Tax in the FY you are liable to pay interest under 234C. In the Income Tax utility, there are some issues that are being noticed when calculating quarterly instalments, incorrect rate of interest and calculation for Dividend and Capital Gain income.
Issues in Foreign Asset Reporting
When reporting foreign asset, if the taxpayer selects “No”, the ITR preview reflects the option “Yes”.
Incidents of Miscalculation
In certain cases, the utility allows rebate u/s 87A for instances where the taxpayer’s net taxable income exceeds INR 5 lac. When the net taxable Income exceeds INR 5 lacs, taxpayers are not eligible to claim rebate u/s 87A.
These errors might cause a little inconvenience to taxpayers for a short while. However, it seems that these are just some initial hiccups. The stakeholders are working on these glitches and very soon taxpayers are going to have a user-friendly Income Tax E-filing portal.