Exempt Income Declaration - Which ITR Form to use?

Q & A Forum › Category: Tax Planning › Exempt Income Declaration – Which ITR Form to use?

Saurabh asked 10 years ago

HI, I have a query related to exempt income declaration in ITR Forms (AY 2016-2017). I have following kind of incomes: - Salary income - FD interest - interest on tax free bonds - mutual fund dividends - PPF interest As per my understanding, i should show interest on tax free bonds, dividends, PPF interest under exempt income column. I have following queries: - Which ITR form should i use considering that total excepted income (tax free bonds interest + PPF interest + MF dividends) is more than 50000 rs. - suppose next year if i have income due to sale of MF units that i purchase 3 years back. Shall i again use ITR-1 and add the income under excepted income. I prefer to use ITR1 as it is simple to fill. please advise.

1 Answers

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Sreekanth Staff answered 10 years ago

Hi, Yes, interest income from TFBs, dividend income & PPF interest amount are tax-exempt incomes. You can file ITR -1. The opinions are divided on this issue.
If Exempt income like Agriculture income or dividend income etc is more than Rs 5,000, some CAs do suggest their clients to file ITR 2A and show the exempt income in EI schedule of the ITR 2A.
But filing ITR-1 and just reporting the total exempt income as EI should not be an issue.