New ITR Forms AY 2015-16 : Which ITR form should you file?

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• I have PPF interest exceeding Rs 5,000 which comes under exempt category. Earlier, form ITR1 could not be used and hence form ITR2 had to be used. Has the situation changed with the new forms for AY 2015-16 i.e. can I now use ITR1 or do I still have to use ITR2 or ITR2A/

  • Dear Mr Mulay,
    Kindly let me know the details of your other incomes.

• Hello Srikanth;
  I am a resident Indian who has income from more than one let out property rented out for commercial plus having income from a partnership business as remuneration.I have been using ITR 3 till last year;now I do not see ITR3 in the IT web site nor having a guideline about.Can you suggest which form should I use for assessment year 2015-16? Can I file return online ( e-filing) ?

  Regards and best wishes
  Krishnakumar

  • Dear Krishnakumar,
    I believe that you can file ITR 4S.

    • Thank you Srikanth.Do you foresee any chance the IT dept announcing a revised ITR 3 or any chance of it ?

      • Dear Krishnakumar,
        ITR 3 is not yet notified and I am not sure about the expected date..we may have to wait for few more days..

• sir, i am a state government pensioner and getting monthly pension. in addition to that i am also getting bank interest. which new ITR form i have to be filed. please tell me. 2) question: my wife is a house-wife. she is getting bank interest only. in which new ITR form she has to be filed. please answer my 2 questions urgently. ramamohanarao .

  • Dear Mr Rao,
    You have to use ITR1 in both the cases.

• Dear Sreekanth,

  Am an NRI

  have rental income from house and interest income.

  Hope i have to go for Form 2A

  please guide me.

  Thanks & Regards

  Raghunathn

  • Dear Raghunathan,
    If you have income from one house property only then you can file ITR1, else ITR2-A.

• Dear Sreekanth,

  Need your suggestion on Homeloan prepayment. I have taken loan of 24L in 2012 and current outstanding principle is ~ 13L(I have paid 7.5L in pre-payments so far).
  I have another 2.5 L with me now. Do you suggest to go for a pre-payment or any investment option for me?

  Please advice.

  Regards,
  Suri.

  • Dear Suri,
    I need few details;
    Your age, dependents details, your financial goal(s) and about your current investments (if any) towards these goals.

    • Dear Sreekanth,

      I am 30 yrs old. I have 3 dependents(spouse/kid/mom).
      I am saving 1L in PPF since 3 years. Planning to take another PPF a/c for my wife and can invest 2.4L per annum for together. Started Sukankya Samruddhi Scheme this year(planning to invest 50K every year).

      Have bank deposits of 3L(for emergency fund).
      Didn't opt for any family health insurance as my employer provides 7.5L for spouse/kids and 3.75L for parents.
      Have LIC premiums for me and my wife(endowment). Took Jeevan Anand with ignorance but continuing as is.
      Yet to take term insurance plan :(
      Gone through your blogs and planning to invest in MFs. Very much beginner but want to be disciplined and can take moderate risks.

      Financial goals:
      Want to have about 6-7 Cr for my retirement. (assuming I retire at 50-52 yrs)
      My PF can get me more than 1 Cr.
      1.5 Cr from PPF(assuming I continue to invest min 2.5L together for my wife and me)
      Plan of 2nd home(of budget 50-60L) at the age of 36-37 yrs with a loan of 35L and finish it by 45 yrs.

      • Dear Surendra,
        Suggest you to kindly go through the below articles and revert to me after reading them;
        Retirement planning goal made easy
        Kid's education goal planning
        How to get rid off unwanted life insurance policy?
        Best Top up health insurance plans
        The 6 most common personal finance mistakes

        • Dear Sreekanth,

          Thank you for the valuable information. I got some insight and planning to invest in below funds for marriage and retirement plans. (for 15 years)

          Please suggest can I go ahead with this selection or do you suggest any modifications,

          ICICI Prudential Focused Blue Chip Equity Fund - Regular Plan - Growth
          Mirae Asset India Opportunities Fund - Regular Plan - Growth
          HDFC Mid-Cap Opportunities Fund - Growth
          Tata Balanced Fund - Growth
          UTI Equity Fund - Growth

          Please advice.

        • Good ones..stay invested and all the best :)

        • Thank you :).

        • Dear Sreekanth,

          Want to take your opinion on money back guaranteed policies. How good/bad are these for long term investment options?
          For ex considering this plan, http://www.reliancelife.com/life-insurance-plans/saving-investment-plans/reliance-of-guaranteed-money-back-plan
          if I invest say 50K per annum for 5 years, and stay long for 20 years.
          Do these(similar ones) provide good returns as claim themselves as non-ULIP based?

          Please provide your suggestion on these.

          Regards,
          Surendra.

        • Dear Surendra..
          Kindly read my articles -
          Term insurance Vs Traditional plans (Moneyback/endowment)
          LIC Money back plans - review (Low returns)

          Consider not to buy these kind of plans and instead opt for Equity funds for long term (20 years).

        • Thanks a lot Sreekanth. This really helps :). Kudos to you.

        • Welcome dear Surendra..Share the articles with your friends. Keep visiting :)

• Having retired in India, I am now an NRI. In India, I receive pension and some dividends. Which ITR do I have to use. Of course in the overseas country, I do have a bank account. Thanks.

  • Dear Ram,
    I believe that you can file ITR1.

• Dear Mr. Sreekanth,
  I am NRE from more then 22 years and I have been filing income tax returns on interest earned on only my NON-NRE bank deposits.
  During this year AY 2015-2016 (FY 2014-15)
  1) I have one FMP matured after 3 years and with earning maturity amount went to my NRE a/c
  2) Another FMP matured after 3 year and with earning maturity went to my NON-NRE a/c

  As from your article, I should calculate long term gain 20% (with indexation) on income of both funds and I should file return on ITR-2. Could you please advise how do we calculate on these LTCG.

  Please advice,

  • Dear Surendra,
    Have you invested in FMP through any online brokerage platforms??
    Most of them do provide Capital gains statement.

    • Dear Sreekanth,
      Thanks for your prompt reply. My FMP investment were through a broker and also looked at company's (Reliance & ICICI ) redemption statement but no where capital gain is mentioned.
      I would be very thankful to you for your guidance on above subject.
      Regards,

      • Dear Surendra,
        You may contact your broker for capital gain statement.

• Hai, I was in Canada for 3 months. I went there on Inter Company Transfer (ITC). My employer computed the combained Indian salary and Canadian allowance in Canada. The taxes were deducted as per tax rules of Canada.

  But when I was back from Canada, my employer started deducting the tax of the three months in Canada in India.

  Please suggest on how should I calculate to avoid double tax.

  • Dear Thrinath,
    The income that you have earned in India needs to be reported in India in your Income Tax Return.
    I assume that you are Resident Indian (not an NRI)..
    As per Section 90 of Income Tax act, you can get relief from double taxation (Double Taxation Avoidance Agreement -DTAA). Suggest you to kindly consult a Chartered Accountant and get this done.
    Request you to share the update here. It would be useful for other blog reader too.

• I had a mutual fund which i bought in 2008 (ELSS equity) and I sold it in 2014 December. STT was paid for this . Which form should I choose for ITR ? Also do I need to mention about this in ITR ?

  • Dear AJ,
    The Long Term Capital Gains on ELSS funds are exempted from taxes. There is no need to mention this information in your ITR.
    Read my article : MF Taxation rules.

• Hello Mr Reddy!

  I cannot decide between ITR1 and ITR2. can you help?

  I have NRE account that earn Rs. 7500 interest...it is tax-exempt you know, so can I use ITR1 and report this on line 26 of Schedule "Taxes Paid and Verification" ?

  Is the rs 5000 limit only for agriculture or ALL tax exempt income? I have read conflicting advice, that is why I consult you.

  BTW, also they have ITR2A, should I use that maybe?

  • Dear Sunil,
    I believe that there is no need to show NRE A/c's interest income in ITR.
    Only the agricultural income to the extent of Rs 5k is exempted (but there is a separate calculation that needs to be done ..)
    The type of ITR form is dependent on your other incomes as well. Kindly refer to the chart provided in the article.
    Revert to me if you need any assistance.

    • Mr. Reddy,

      According to ITR-2 instructions, Part 14 (l)(i), there is a Schedule EI in which it is specifically for reporting tax-exempt income. It reads:

      "Furnish the details of income like agricultural income, interest, dividend, etc. which is exempt from tax."

      Are you sure NRE interest is not to be reported?

      Thank you for your feedback

      • Dear Sunil,
        I checked with my CA friend on this.. Yes, interest earned on NRE deposits need to be shown in ITR under exempt income..though they are tax free..