Amendments in I.T. Act for A.Y. 2011-12 and

Changes in ITR Forms.

JAGRUT M. PATEL

Change in Tax Rates

Income tax slab for A.Y. 11-12New Income Tax Slabs for ay 11-12 for Resident Senior Citizens

Sr. No. Income Range Tax percentage

1 Up to Rs 2,40,000 No tax / exempt

2 2,40,001 to 5,00,000 10%

3 5,00,001 to 8,00,000 20%

4 Above 8,00,000 30%

Income Tax Slabs for ay 11-12 for Resident Women (below 65 years)

1 Up to Rs 1,90,000 No tax / exempt

2 1,90,001 to 5,00,000 10%

3 5,00,001 to 8,00,00 20%

4 Above 8,00,000 30%

New Income Tax Slabs for ay 11-12 Others & Men

1 Up to Rs 1,60,000 No tax / exempt

2 1,60,001 to 5,00,000 10%

3 5,00,001 to 8,00,000 20%

4 Above 8,00,000 30%

Some other AmendmentsSome other Amendments

• In the case of a domestic company, rate of S.C. on I.T. reduced from 10% to 7.5%.

• Rate of MAT on book profit u/s. 115JB enhanced from 15% to 18%.

For Foreign Companies• Foreign companies are taxable @ 40 percent • Surcharge is applicable @ 2.5 percent if total

income is in excess of INR 10,000,000.Marginal relief may be available

• Education Cess is applicable @ 3 percent on income-tax.

For Co-operative Societies• Upto 10000 10• 10000 to 20000 20• 20000 & above 30

Insertion of new Section 44AD

Amendments in PGBPPreviously u/s 44AF

In the case of an assessee engaged in retail trade in any goods or merchandise, a sum equal to 5% of the total turnover in the previous year is considered as net profit.

Notwithstanding anything to the contrary contained in

sections 28 to 43C, in the case of an eligible assessee

engaged in an eligible business, a sum equal to 8%

of the total turnover or gross receipts of the assessee

in the previous year on account of such business or,

as the case may be, a sum higher than the aforesaid

sum claimed to have been earned by the eligible

assessee, shall be deemed to be the profits and gains

of such business chargeable to tax under the head

Profits and gains of business or profession.

Sec.-44AD

Eligible business means:-

1. Any business except the business of plying, hiring or leasing goods carriages referred to in section 44AE; and

2. Whose total turnover or gross receipts in the previous year does not exceed an amount of

sixty lakh rupees.

There is specific Turnover limit of Rs. 15 Lakhs for Profession under section 44AB, which means that profession is totally separate from Business.

The assessee is bound to get the books of accounts audited, if the following two

conditions are satisfied:-

1. His profits and gains from the eligible business are lower than the profits and gains specified in sub-section (1) i.e. his net profit is lower than 8% of turnover.

And2. Whose total income exceeds the

maximum amount which is not chargeable to income-tax.

X, A Resident individual, is carrying on three eligible business, the turnover of

which is as under :-

• Business A ( Manufacturing) Rs. 25 Lac• Business B( Trading) Rs. 15 Lac• Business C ( Service) Rs. 25 Lac

Q. Whether section 44AD applicable on

him?

The Answer is NO because turnover of eligible business exceed Rs. 60 Lakhs.

X, A Resident individual, is carrying on two business, the turnover of which is as

under :-

• Business A ( Eligible Business) Rs. 55 Lk• Profession Rs. 10 Lk• Business B( Transport u/s 44AE) Rs. 6

Lk

Here, Section 44AD and 44AE both are applicable, as profession is not included undersection 44AD and section 44AD and 44AE are

independent of each other.

Sec. 44AESec. 44AE

• Plying, leasing or hiring of trucks (person should not own over 10 goods carriage at any time during the previous year)

• INR 5,000 per month/ part of month for each heavy goods vehicle.  

• INR 4,500 per month/ part of month for each light goods vehicle.

Revision of TDS limits and rates- A Glance

Threshold limits forTDS increased w.e.f.

01.07.10:-

Section

Nature of Payment

Existing limit

Revised limit

If Recipient is Comp., Co-op Soc., Firm

If Recipient is Indiv.Or HUF

194B Winnings from lottery orcrossword puzzle

5000 10000 30 30

194BB Winnings from horse race 2500 5000 30 30

Last date for filing return for 4th Quarter has been amended to 15th May which was previously 15th June.

194C Payment To contractors(for a singletransaction)

(for aggregate oftransactions duringfinancial year)

20000

50000

30000

750002 1

194D Insurance commission 5000 20000 10 10

194H Commission or Brokerage 2500 5000 10 10

194I Rent Other than Plant, Machinery & Equp.

Rent Of Plant, Machinery & Equp.

120000

120000

180000

180000

10

2

10

2

194J Fees for professional or technicalservices

20000 30000 10 10

There is no changes under Sec. 194A

Introduction of 80CCF

Introduction of 80CCF

The new section 80CCF, will offer a deduction

of Rs 20,000, in addition to the deduction of

Rs 1 lakh under sections 80C, provided the

investments are in notified long term

infrastructure bonds. The government has

proposed this section to promote investments

in infrastructure projects in the country.

• This section is applicable from A.Y 2011-12.

• Deduction under this section is available only to Individuals and HUFs tax payers.

• The long term infrastructure bonds will have tenure of 10 years.

• Minimum lock in period of 5 years.

• Investments in infrastructure bonds would require PAN to be mandatory furnished.

The Central Government have The Central Government have Specified bonds to be issued by:Specified bonds to be issued by:

• Industrial Finance Corporation Of India

• Life Insurance Corporation Of India

• Infrastructure Development Finance Company Limited

• A Non-Banking Finance Company Classified as an Infrastructure Finance Company by the Reserve Bank of India

as “Long Term Infrastructure Bond” for the purpose of Sec. 80CCF.

Changes in ITR Forms

o SAHAJ is the newly designed ITR-1 which replaces SARAL Income Tax Return.

Who can use SAHAJ?

This Return Form is to be used by an individual whose total income for the assessment year 2011-12 includes:

• Income from Salary/ Pension; or

• Income from One House Property (excluding cases where loss is brought forward from precious years);

OR

• Income from Other Sources (excluding Winning from Lottery and Income from Race Horses)

• For Carry forward losses always use ITR-2 or 4 Only.

• No AIR anymore • Bank Account Detail is mandatory for

every return.• Linkages to FORM 26AS• SAHAJ can’t be used if,

- Agriculture income exceed 5000- Any brought/Carried forward losses.

Common Points for all ITRs

For Manual Return Filing:

• Bar Code and PAN Number are compulsory on every page

• Compulsory Mobile No.

• Use of Dropout Ink to reduce Interference during Data Capture