Requirement of Maintaining Books as per ITR-4 Sugam
The Central Board of Direct Taxes (CBDT) has notified two Income Tax return (ITR) forms for the assessment year of 2020-21 i.e. ITR-1 (Sahaj) and ITR-4 (Sugam) in the first week of January. Only the forms have been notified without the return filing utility. Thus, a taxpayer, who is required to file the return before the previous year ends, cannot do so until the return filing facility is activated on the e-filing portal.
This article discusses, if one is required to maintain books of accounts in line of newly introduce form ITR-4 Sugam.
Earlier businesses were required to give below mentioned details in ITR – 4:
|S.No.||FINANCIAL PARTICULARS OF THE BUSINESS||Amount|
|1||Partners/ Members own capital|
|Total capital and liabilities|
|11||Balance with banks|
|13||Loans and advances|
The Newly introduced ITR 4 Form Sugam, requires, Taxpayer to give opening balance of cash in hand and opening balance of bank accounts details of cash and bank inflow & outflow along with the closing balance of cash & bank Balances as per below mentioned format.
|Description||Cash||Bank (aggregate amount of all the bank accounts)|
|Receipts during the previous year|
|Payments / Withdrawals during the previous year|
Authors view: Earlier ITR-4 required, figures of unsecured loans, sundry debtors, sundry creditors, amount of closing stock, etc. If you look carefully, FINANCIAL PARTICULARS OF THE BUSINESS as required by Earlier form, were nothing, but Balance Sheet of the Taxpayer.
Whereas the new ITR-4 requires Taxpayer to provide Receipt & Payment Account.
One aspect to this would be that although Books of Accounts were required to be maintained, earlier also but now government has understood that a small tax payer taking benefit of presumptive scheme would concentrate more on receipt & payments, rather than following accrual concept of accounting and that’s why Former Balance Sheet has been replaced by receipt & payments A/c.
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