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Who should file Schedule AL (Assets and Liabilities) in ITR?

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Divya Singhvi

Assets and Liabilities
Income from Business & Profession
Income Tax

Government of India has been introducing various changes to the Income Tax Returns. One such compliance in ITR is the “Schedule AL”. Generally, a taxpayer carrying on business or profession is required to fill in details of assets and liabilities through a Balance Sheet in the ITR. However, in some cases, it is mandatory for taxpayers to disclose their assets and liabilities at the end of the year. Such taxpayer can fill in the details through the Schedule AL.

What is Schedule AL?

This schedule requires the taxpayer to disclose details of various assets owned by them & the corresponding liabilities. But, it is mandatory for specified assessee only. The reason behind it’s inclusion was to have a record of all the assets owned by certain group of people. The disclosure of assets consists of immovable property, movable property and financial assets owned by the taxpayer. The liabilities include all liabilities of the taxpayer in relation to such assets.

When is Schedule AL (Assets and Liabilities) applicable?

Not all the tax payers have to disclose their assets and liabilities. The requirement to furnish particulars of certain assets and liabilities applies individuals and HUFs having an annual income exceeding INR 50 lakh. This requirements are applicable for those filing ITR 2 and ITR 3. This is in addition to the Balance Sheet of the business or profession to be filed in ITR-3.

What if total income of taxpayer is exactly INR 50 lakhs?

Your total income is calculated by subtracting tax saving deductions under Chapter-VI-A from Gross Total Income of a taxpayer. In case, total income of taxpayer is coming exactly INR 50 lakhs, then Schedule AL is not applicable.

For better understanding, lets take an example of Sweksha.

Her gross income per annum is INR 53 lakh. However, she gets a tax deduction of INR 1.5 lakh for investments and expenditures under section 80C and INR 50000 under section 80D. In addition, she has been paying home loan instalments and qualifies for the deduction on home loan interest of INR 1 lakh per annum.
Therefore this brings down her net income to INR 50 lakh. Now, she is not required to file Schedule AL in her ITR.
Further, if there was no home loan interest deduction in that case, the net income would amount to INR 51 lakh. This income would exceed the threshold limit of INR 50 lakh. Consequently, it would be mandatory for Sweksha to fill Schedule AL.

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What details are required to be disclosed in schedule AL?

Taxpayers will have to report the following details in Schedule AL:

Guidelines to file Schedule AL (Assets and Liabilities)

Here are a few points you must comply to, while filing Schedule AL:

ITR for Proprietors with Business Income
CA Assisted Income Tax Return filing for Individuals & HUFs with business income from Proprietary Firm.
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ITR for Proprietors with Business Income
CA Assisted Income Tax Return filing for Individuals & HUFs with business income from Proprietary Firm.
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FAQ

Is schedule AL applicable for non residents also ?

Yes, schedule Al is applicable irrespective of residential status to individuals and HUFs if the taxable income exceeds INR 50,00,000

I hold foreign assets during the previous year which have been duly reported in the Schedule FA. Whether I am required to report such foreign asset again in the Schedule AL (if applicable)?

Yes, you are required to mention the same in Schedule AL as well.

Got Questions? Ask Away!

  1. Hi @Dixita

    Not all the tax payers have to disclose their assets and liabilities. Only the individuals or HUFs having total income exceeding INR 50 lakh should fill in Schedule AL. Your total income is calculated by subtracting Chapter VI A deductions from Gross Total Income.

    Hope this helps :slightly_smiling_face: