Know everything about Form ITR-2

Last Updated On: Dec. 11, 2021, 10:50 p.m.
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HOW TO FILE FORM ITR-2?

Every individual or HUF whose total income before allowing deductions under Chapter VI‐ A of the Income‐tax Act, exceeds the maximum amount which is not chargeable to income tax is obligated to furnish his return of income. The claim of deductions under Chapter VI‐A is to be mentioned in Part C of this Return Form. 

 

1.Who is eligible to use this Return Form?  

This Return Form is to be used by an individual or a Hindu Undivided Family (HUF) who is not eligible to file Form ITR‐1 (Sahaj) and who is not having any income under the head “Profits or gains of business or profession”.

 

2. Who is not eligible to use this Return Form?    

This Return Form should not be used by an individual whose total income for the Assessment Year 2021‐22 includes Income under the head “Profits or Gains of Business or Profession”.

 

3. What is the structure of ITR-2?

The form is divided into two parts:

PART A: GENERAL INFORMATION

Schedule S: Details of income from salaries

Schedule HP: Details of income from House Property

Schedule CG: Computation of income under Capital gains

Schedule 112A- From sale of equity share of a company or a unit of equity oriented fund /business trust on which STT is paid

Schedule 115AD (I)b(b) (iii) proviso- For Non-Residents -From sale of equity share of a company or a unit of equity oriented fund /business trust on which STT is paid

Schedule OS: Computation of income under Income from other sources

Schedule CYLA: Statement of income after set off of current year’s losses

Schedule BFLA: Statement of income after set off of unabsorbed loss brought forward from earlier years

Schedule CFL: Statement of losses to be carried forward to future years

Schedule VIA: Statement of deductions (from total income) under Chapter VIA

Schedule 80G: Statement of donations entitled for deduction under section 80G

Schedule 80GGA: Statement of donations for scientific research or rural development

Schedule AMT: Computation of Alternate Minimum Tax payable under section 115JC

Schedule AMTC: Computation of tax credit under section 115JD

Schedule SPI: Statement of income arising to spouse/ minor child/ son’s wife or any other person or association of persons to be included in the income of the assessee in Schedules-HP, CG and OS

Schedule SI: Statement of income which is chargeable to tax at special rates

Schedule EI: Details of Exempt Income

Schedule PTI: Pass through income details from business trust or investment fund as per Section 115UA, 115UB

Schedule FSI: Statement of income accruing or arising outside India.

Schedule TR: Details of taxes paid outside India

Schedule FA: Details of Foreign Assets and income from any source outside India

Schedule 5A: Statement of apportionment of income between spouses governed by Portuguese Civil Code

Schedule AL: Asset and liability at the year-end (applicable in case the total income exceeds Rs 50 lakhs)

Schedule DI: Schedule of tax-saving investments or deposits or payments to claim deduction or exemption in the extended period from 1 April 2020 until 30 June 2020

 

Part B-TI: Computation of Total Income

Part B-TTI: Computation of tax liability on total income

Tax payments- Details of payment of advance tax and self-assessment tax

Details to be filled if the return has been prepared by a Tax Return Preparer

 

 

4. What changes are made in Form ITR-2 for AY 2021-22?

ITR forms have been updated to include a declaration of choosing between old or new tax regime introduced by the Finance Act 2020 under section 115BAC. Form 10IE needs to be submitted to the ITR department before filing ITR if the assessee chooses to pay tax according to the new tax regime. ITR forms seek the acknowledgement number of Form 10IE in case the assessee is opting for the new tax regime. 

According to Finance Act 2020, It is allowed to defer the payment or deduction of tax on ESOPs allotted by an eligible start-up covered under Section 80-IAC. If an employee receives ESOPs from an eligible start-up as mentioned under Section 80-IAC regarding which the tax has been deferred, the Part B of Schedule TTI (Computation of tax liability on total income) seeks the disclosure of this deferred tax.

Finance Act 2020 shifted the taxability of dividend income from the company’s hands to the investor’s hands. Sections 10(34), 10 (35), 115-O, 115-R, 115BBDA have been amended. A new row has been added in Schedule OS to allow deduction of expenses like interest from the dividend income. Also, a new row has been added under schedule OS to incorporate details of dividend income taxable in the hands of the unitholders of business trust. 

All ITR forms prompt the return filers to provide a quarterly break up of the dividend income for the purpose of interest calculation under section 234C.

The ITR forms have been updated to include the effect of marginal relief by showing ‘surcharge calculated ‘before marginal relief’ as well as ‘after marginal relief’. Previous to this, no separate effect was required to be shown in the ITR Forms.

Schedule DI inserted in the previous ITR forms for any investment made for the extended period allowed, i.e. 1st April 20 to 31st July 20, is now removed from all the ITR Forms.

Section 50C governs the determination of the value of the sale consideration in case of land or building or both. If the sale consideration is less than the stamp duty value, then the stamp duty value will be considered the full value of consideration except for a difference of 5%. Finance 2020 increased the tolerance limit from 5% to 10%, and the changes have been made in the ITR.

Separate disclosure of cash donation under schedule 80GGA along with date is required in the ITR Form. 

ITR form has been updated with a new column under schedule 112A and 115AD (1)(b)(iii) proviso to be able to provide the details of the nature of securities transferred. Also, both the schedules have been updated to give the ‘grandfathering clause’ effect by allowing to mention the details like Sale price, FMV and COA of the securities.

 

5. HOW TO FILE FORM ITR-2?

Form ITR-2 can be filed online or offline:

Online/Electronically:

  • By furnishing the return electronically under digital signature
  • By transmitting the data electronically and then submitting the verification of the return in Return Form ITR-V
  • If you submit your ITR-2 Form electronically under digital signature, the acknowledgement will be sent to your registered email id.

 

Offline:

Only the following persons can file their ITR offline:

  • Individuals who are of the age of 80 years or above.

Return can be filed offline by:

  • By furnishing a return in a physical paper form
  • By furnishing a return in bar-coded

The Income Tax Department will issue you an acknowledgement at the time of submission of your physical paper return.

 

 

 

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