ITR 1 is the simplest one-page Income Tax Return Form for individuals having income from Salary / Pension, One House Property, and income from other sources. It is the basic ITR Form.
Up to FY 2018-19 (AY 2019-20), it was not mandatory to file Income Tax Return if the total income was less than the basic exemption limit. However, Budget 2019 inserted the seventh proviso to Section 139(1). As per this new provision, if a taxpayer has entered into high-value transactions, it is mandatory to file the ITR even if the total income does not exceed the basic exemption limit. The high-value transactions can be either of the following:
If the taxpayer has deposited more than INR 1 Cr in a current account
If the taxpayer has incurred foreign travel expense of more than INR 2 lacs
Or, if the taxpayer has incurred electricity expense of more than INR 1 lac
Income from Other Sources (excluding winning from Lottery and Income from racehorses).
In case the income of a spouse or minor child is clubbed with the taxpayer’s income then they can file it only if their clubbed incomes include the above categories.
Taxpayers are given the option to choose between the old tax regime and the new tax regime
Dividend Income has to be added with a quarterly breakdown for accurate calculation of Interest under Section 234C
Major Changes in ITR 1 for AY 2020-21
The individual taxpayers who meet the following criteria:
Make cash deposits above INR 1 Crore with a bank,
Incur expenses above INR 2 Lakh on foreign travel or,
Spend above INR 1 Lakh on electricity should also file ITR 1
Condition of the individual having income from salaries, one house property, other income, and having total income up to INR 50 Lakh continues
Resident individuals owning a single property in joint ownership can also file ITR 1 where the total income is up to INR 50 Lakh
Taxpayers should separately disclose the amount of the investment or deposits or payments towards tax saving made from 1 April 2020 until 30th June 2020
The Income Tax Return form for FY 2018-19 is not applicable to an individual who is either a director of a company or has invested in unlisted equity shares
Under Part A, there is an introduction of ‘Pensioners’ checkbox under the ‘Nature of employment’ section.
The Return filed under section has been segregated between normal filing and filed in response to notices.
Segregation of Deductions under salary will into standard deduction, entertainment allowance, and professional tax.
The taxpayers will have to provide income-wise detailed information under the ‘Income from other sources’.
Introduction of a separate column under ‘Income from other sources’ for deduction u/s 57(iia) – in case of family pension income.
Inclusion of Section 80TTB column for senior citizens.
FAQs
Can Non-Resident of India (NRI) file ITR 1?
No. NRI can file any other ITR form depending upon the source of income earned by them in India. ITR 1 can only be filed by an Ordinary Resident of India.
Do I need to submit supporting documents along with ITR 1?
It is an annexure less form. Hence no need to send any supporting documents to the IT Department.
Can I file ITR 1 if I have multiple Form 16?
Yes. Any resident individual who has earned income from salary during the financial year can file ITR 1. Change in employment does not affect the ITR form type.
Can I file ITR 1 without Form 16?
Yes. A taxpayer can file ITR 1 without Form 16. However, he needs to calculate his taxable salary income for a financial year while filing ITR.
Is it mandatory to provide bank account details in Income Tax Return?
Yes. It is mandatory to provide active bank account details. You are also required to select one account as your primary account. Since your refund will be directly issued to your Bank Account vis ECS.
Can I file a return after the Due Date?
Yes. You can file a ‘Belated Return’ after the due date. You can file a belated return before the end of Assessment Year or before the completion of the assessment whichever is earlier. Late filing fees as per section 234F will also be levied.
Can I file exempt income in ITR-1?
Yes, you can file exempt income in ITR 1. However, if agriculture income exceeds INR 5000 then you will have to file ITR 2.
Do we have to report exempt LTCG in ITR 1?
Yes, you need to report exempt LTCG in ITR 1 provided it is exempt u/s 10(38). In case you have any taxable LTCG, you can use the other income tax return forms that are applicable. Additionally, it is necessary to e file tax returns if LTCG exceeds INR 2.5L even if your income is below taxable limit.
Is it necessary to add dividend income from mutual funds?
Yes. Dividend income from mutual funds is exempt u/s 10(35). It is shown in the Part D under the head Exempt Income (others).
I have no due refund. Do I still have to enter my account details in the return?
Yes, it is mandatory to fill in your bank account details, whether you have refund due or not. This is because it has been noticed that many taxpayers end up paying more than their required tax liability. In such cases, it is important for the Income Tax Department to send refunds within a certain amount of time.
How many returns can I file using the same mobile number and e-Mail address?
You can only file 10 returns using the same e-Mail ID and mobile number.
This quarterly breakdown of Dividend Income under IFOS will help to calculate and determine penalty u/s 234C for the delay in payment of Advance Tax.
Hope this helps!
I had received dividend recently but I had noticed that TDS had been deducted. any idea as to why has it happened and is there a way I can claim this TDS?
After the introduction of Budget 2020, dividend income is now taxable in the hands of the shareholder; and is also subject to TDS at 10% in excess of INR 5000 u/s 194 & 194K. Foreign Dividend is taxable at slab rates. TDS is not applicable to such dividends. The taxpayer should report such income under the head IFOS in the ITR filed on the Income Tax Website.
You need to pay Income tax on the net taxable income, i.e. after subtracting deductions, expenses, etc.
If the net taxable income is negative i.e. if there is loss, you can carry it forward when filing the ITR
The amount of TDS deducted shall reflect in your Form 26AS only and it will also reflect the name of the deductor.
Using the name of the deductor you can find out on which share you have received the dividend and you can also cross-check the same in your bank statement.
Yes, you are right, TDS is to be deducted when the dividend paid exceeds 5000 INR in a financial year. However, the 5,000 INR limit pertains to all the dividends an individual gets in a year, or the total dividend per shareholder that a company pays out in a year, is left to interpretation, and hence registrars and share transfer agents (RTA) are not taking any chances and are deducting TDS even on small amounts.
You can submit a grievance on Income Tax Portal mentioning the issue and also attach the 26AS.
The other option is to leave it as it is and clarify it when the tax department sends the notice.
Consider that I have 10 shares each of 10 different Indian companies. Each of the 10 companies are declaring a dividend of INR 100 before the FY ends. Now I will be recieving 1000 as dividend from each company, thereby a total of 10,000.
The 5,000 dividend limit, is it applicable to each company / total dividend recieved by me in a year. If it is applicable to each company, then I would not attract TDS of 10% for dividend.
Also pl clarify, how would the company B know that I have got shares of Company A,C,D,E so on…
Hey @TeamQuicko
Thanks for the blog! Just one quick question - Why do we have to report a quarterly breakdown of Dividend Income under IFOS?
Thank you!
Hey @TanyaChopra
This quarterly breakdown of Dividend Income under IFOS will help to calculate and determine penalty u/s 234C for the delay in payment of Advance Tax.
Hope this helps!
I had received dividend recently but I had noticed that TDS had been deducted. any idea as to why has it happened and is there a way I can claim this TDS?
Hey @HarshitShah
After the introduction of Budget 2020, dividend income is now taxable in the hands of the shareholder; and is also subject to TDS at 10% in excess of INR 5000 u/s 194 & 194K. Foreign Dividend is taxable at slab rates. TDS is not applicable to such dividends. The taxpayer should report such income under the head IFOS in the ITR filed on the Income Tax Website.
Hope this helps!
Hey @HarishMehta
Yes, dividend income is now taxable from FY 2021-22 onwards and it has to be reported under the head of IFOS.
You can read more about it here:
Hi @Maulik_Padh,
You need to pay Income tax on the net taxable income, i.e. after subtracting deductions, expenses, etc.
If the net taxable income is negative i.e. if there is loss, you can carry it forward when filing the ITR
Here are some of the articles which might help
Hi @ameyj
The amount of TDS deducted shall reflect in your Form 26AS only and it will also reflect the name of the deductor.
Using the name of the deductor you can find out on which share you have received the dividend and you can also cross-check the same in your bank statement.
Yes, you are right, TDS is to be deducted when the dividend paid exceeds 5000 INR in a financial year. However, the 5,000 INR limit pertains to all the dividends an individual gets in a year, or the total dividend per shareholder that a company pays out in a year, is left to interpretation, and hence registrars and share transfer agents (RTA) are not taking any chances and are deducting TDS even on small amounts.
Hope this helps
Hi @ameyj
You can submit a grievance on Income Tax Portal mentioning the issue and also attach the 26AS.
The other option is to leave it as it is and clarify it when the tax department sends the notice.
Hi @TeamQuicko
Consider that I have 10 shares each of 10 different Indian companies. Each of the 10 companies are declaring a dividend of INR 100 before the FY ends. Now I will be recieving 1000 as dividend from each company, thereby a total of 10,000.
The 5,000 dividend limit, is it applicable to each company / total dividend recieved by me in a year. If it is applicable to each company, then I would not attract TDS of 10% for dividend.
Also pl clarify, how would the company B know that I have got shares of Company A,C,D,E so on…
@Saad_C @Laxmi_Navlani @Divya_Singhvi @Kaushal_Soni @AkashJhaveri can you help with this?