[FAQs] Income Tax Returns (ITR) | Reporting in Schedules in ITR

  • ITR Week 2024-25|Blog|Income Tax|
  • 6 Min Read
  • By Taxmann
  • |
  • Last Updated on 19 June, 2024

ITR Reporting Requirements

ITR (Income Tax Return) reporting requirements refer to the information and documentation taxpayers must provide when filing their income tax returns in India. These requirements ensure taxpayers accurately report their income, deductions, and tax liabilities for the relevant assessment year. Key reporting requirements typically include:
– Disclosure of Income: Income from salary, house property, capital gains, business or profession, and other sources
– Bank Account Details: Disclosure of all bank accounts held in India during the financial year, excluding dormant accounts
–  Foreign Assets and Income: Reporting of foreign assets, foreign income, and any signing authority in foreign accounts in Schedule FA. Details of foreign taxes paid and claiming credit using Form No. 67
– Unlisted Equity Shares: Reporting details of unlisted equity shares, including company name, PAN, number and cost of shares, acquisition, and sale details in the relevant ITR forms (e.g., ITR-2, ITR-3, ITR-5)
– Virtual Digital Assets (VDAs): Reporting income from cryptocurrencies and NFTs in Schedule VDA, including acquisition and transfer details
– Deductions and Exemptions: Claiming deductions under various sections like 80C, 80D, and others. Reporting exempt income, such as agricultural income, in the appropriate schedule
– Schedule AL (Assets and Liabilities): Reporting assets and liabilities if total income exceeds Rs. 50 lakhs, including foreign assets
– Standard Deduction: Claiming a standard deduction of Rs. 50,000 against salary income, which can be claimed only once per year
– Interest Income from Provident Fund: Reporting interest income from employee contributions to provident fund accounts exceeding specified limits
– Form 16: Reporting salary income using Form 16 provided by employers.

FAQ 1. Are taxpayers required to disclose all bank accounts held during the financial year?

Yes. For the Assessment Year 2024-25, the new ITR forms mandate taxpayers to disclose all bank accounts held in India during the previous year. However, dormant accounts are exempt from this requirement.

FAQ 2. What is the ‘relevant accounting period’ for reporting foreign assets in Schedule FA?

Schedule FA (Foreign Assets) is compulsory for Indian residents if they:

  • Hold any assets outside India,
  • Have signing authority in any foreign account, or
  • Earn income from foreign sources.

Non-residents (NR) or Not Ordinarily Residents (NOR) are not required to file Schedule FA. The relevant accounting period for reporting foreign assets is the previous calendar year. This means assets held even for a single day between January 1, 2023, and December 31, 2023, must be reported for the Assessment Year 2024-25, irrespective of the fiscal year in the foreign country.

Example 1

Relevant previous year April 1, 2023 – March 31, 2024
Relevant calendar year January 1, 2023 – December 31, 2023
Date of purchase of shares in Google LLC January 2023
Is the assessee required to furnish the details regarding the foreign assets acquired? Yes

The assessee must furnish the details of Google LLC’s share in ITR applicable for Assessment Year 2024-25 even if he has not held the foreign asset in the previous year.

Example 2

Relevant previous year April 1, 2023 – March 31, 2024
Relevant calendar year January 1, 2023 – December 31, 2023
Date of purchase of shares in Google LLC January 2024
Is the assessee required to furnish the details regarding the foreign assets acquired? No

Taxmann.com | Practice | Income-tax

FAQ3. I paid taxes in a foreign country while working on a project for three months, how can I claim credit for this in my ITR?

If you paid tax in a foreign country, you can claim a credit for it in the year when the income is offered or assessed to tax in India. As per Rule 128 of the Income-tax Rules, 1962, you must submit Form No. 67 detailing the foreign income and taxes paid, along with other required documentation by the following deadlines:

Return Filing Under Due Date of Filing Documents to Claim FTC
Original return (Section 139(1)) On or before the end of the assessment year
Belated return (Section 139(4)) On or before the end of the assessment year
Updated return (Section 139(8A)) On or before the date of filing the return

Details of the relief claimed must be reported in ‘Schedule TR’ of the ITR form.

FAQ 4. How should I report the ‘cost of acquisition’ and ‘sale consideration’ for unlisted equity shares acquired by gift, will, amalgamation, etc.?

A new table in ITR forms [ITR-2, ITR-3 & ITR-5] requires reporting unlisted equity shares, including:

  • Company name
  • Company PAN
  • Number and cost of shares at the beginning of the year
  • Details of shares acquired during the year (number, face value, issue price, and date)
  • Details of shares sold during the year (number and sale consideration)
  • Number and cost of shares at the end of the year

If the cost of acquisition or sale consideration is not ascertainable due to acquisition via gift, will, etc., zero or an appropriate value may be entered. These details are for reporting purposes only and do not impact income computation or tax liability[1].

FAQ 5. Should shares listed on the New York Stock Exchange be reported as unlisted in the ITR?

No. Shares listed on a recognized stock exchange outside India are not considered unlisted shares for ITR reporting. However, they must be reported in Schedule FA.

FAQ 6. Are shares of a cooperative bank or society considered unlisted for ITR reporting?

No. Shares in cooperative banks or societies are not considered unlisted for ITR purposes. Reporting is only required for unlisted equity shares in companies registered under the Companies Act.

FAQ 7. Do I need to report unlisted shares held as stock-in-trade?

Yes. Unlisted equity shares held as stock-in-trade must be reported in the ITR.

FAQ 8. Should foreign assets be reported in Schedule AL if they have already been reported in Schedule FA?

Yes. Schedule AL requires reporting of assets and liabilities if total income exceeds Rs. 50 lakhs. Foreign assets must be reported in Schedule FA and Schedule AL if held at the end of the previous year.

FAQ 9. What is the beneficial owner or beneficiary for reporting in Schedule FA?

A ‘beneficial owner’ is defined in Section 139(1) of the Income-tax Act, 1961, as an individual who provides, directly or indirectly, the consideration for the asset and holds it for their benefit or another person.

FAQ 10. What is the meaning of ‘Financial Interest’ in Schedule FA?

‘Financial Interest’ includes situations where the resident assessee:

  • Is the record owner or legal title holder of a financial account or
  • Holds the title indirectly through:
  • An agent, nominee, or attorney,
  • A corporation where the assessee has any share or voting power,
  • A partnership where the assessee has an interest,
  • A trust with beneficial or ownership interest,
  • Any entity with voting power, equity interest, or interest in profits.

FAQ 11. Should details be reported in Schedule AL if they are in the Balance Sheet Schedule of ITR?

No. Assets and liabilities disclosed in the business balance sheet in Part A-BS of ITR are not required to be reported in Schedule AL.

FAQ 12. I have deposited Rs. 7,00,000 in my provident fund account. Is there any reporting requirement?

Interest income from employee contributions over Rs. 2,50,000 (or Rs. 5,00,000 if there is no employer contribution) to a provident fund is taxable. ITR forms require separate reporting of such interest accrued.

Read More
Employee Provident Fund on Taxmann.com/Practice

FAQ 13. How should income from cryptocurrencies be reported?

Income from Virtual Digital Assets (VDAs) like cryptocurrencies and NFTs must be reported in Schedule VDA. It is taxed at 30%, and no deductions other than the cost of acquisition are allowed. Details required include acquisition and transfer dates, category of income, cost of acquisition, and consideration received.

Read More
Taxation of Virtual Digital Assets (VDAs) on Taxmann.com/Practice)

FAQ 14. Can I claim a standard deduction of Rs. 50,000 against the salary from multiple employers?

No. The standard deduction of Rs. 50,000 can only be claimed once per year, regardless of the number of employers. Salary income from all employers should be reported in ‘Schedule S’ using Form 16 from each employer.

[1] Circular No. 18/2019, dated 08-08-2019

Dive Deeper:
Income Tax Returns (ITR) | Which ITR Form is to be filed for AY 2024-25
[FAQs] Income Tax Returns (ITR) | Requirement to File ITR
Income Tax Returns (ITR) | New Tax Regime vs. Old Tax Regime
[FAQs] Income Tax Returns (ITR) | Updated Returns
[FAQs] Income Tax Returns (ITR) | e-Filing of ITR
[FAQs] Income Tax Returns (ITR) | Annual Information Statement (AIS)
[FAQs] Income Tax Returns (ITR) | Capital Gains
[FAQs] Income Tax Return | Tax Payment | TDS | TCS | Refunds
[FAQs] Income Tax Returns (ITR) | Deductions & Rebates
[FAQs] Income Tax Returns (ITR) | Set-off of Losses
[FAQs] Income Tax Returns (ITR) | Clubbing of Income

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3 thoughts on “[FAQs] Income Tax Returns (ITR) | Reporting in Schedules in ITR”

  1. Clarification on the following:
    Q2. How to report a transaction in Schedule FA if it falls outside the accounting period but within the previous year?

    Ans: The CBDT has clarified that a taxpayer shall be required to report foreign assets only if such assets have been held at any time during the “previous year” (in India) and also during the ‘relevant accounting period’ (in the foreign tax jurisdiction).
    So, if its US asset and they follow Jan-Dec, does that mean
    a)only assets held during 1-Apr ’20 to 31-Dec’20 have to reported ?
    b) assets from 1-Apr ’20 to 31-Mar ’21 have to be reported ?
    c) assets from 1-Jan’20 to 31-Mar ’21 have to be reported ?

  2. Hi,

    From where can I take cognizance of Schedule- AL-1 is not required to be furnished if the same details are furnished in Part-A BS.

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