The government has introduced some amendments to the Budget 2022 in the Lok Sabha. After these amendments related to income tax, now the Income Tax Payer will be able to update the loss return as well. At the same time, the Income Tax Department has also got additional time to complete the assessment for the assessment year 2020-21. Earlier the assessment was to be completed by 31 March 2022, the deadline for which has now been extended to 30 September 2022.
The budget was presented on February 1, 2022. After the responses received from the general public and experts, the government usually makes amendments in the budget proposals and these are presented in the Lok Sabha. Experts say that the budget amendment presented on Thursday is very important for the general public as it is related to income tax.
Loss return can be updated
The provision of updated returns was introduced in Budget 2022. This is for those income tax payers who have missed some income declaration. An updated return can be filed within 2 years from the end of an assessment year. For example, if you miss to declare some income for the financial year 2021-22, it gets translated into the assessment year 2022-23. According to the new provisions, you can file updated returns till the financial year 2024-25.
After the amendment introduced in the Lok Sabha on Thursday, now this facility has also been started for loss returns. A loss return is one where net loss is declared and no tax is payable. Updated return is the return which is filed by you within two years of any assessment year. In the updated return, you include those incomes which you had forgotten to include in ITR earlier and on this you have to pay both tax and penalty. Bengaluru-based chartered accountant Prakash Hegde told Live Mint that the amended Finance Bill allows individuals who filed loss returns to be allowed to file updated returns.
Assessment time extended
The government is gradually reducing the time limit given to the Income Tax Department to complete the assessment. The assessment for the assessment year 2020-21 was to be completed within 1 year from the end of the assessment year. This period is ending on 31 March 2022. From the assessment year 2021-22, this time limit was further reduced to 9 months. However, in the amendments introduced in the Lok Sabha on Thursday, the deadline for completion of evaluation proceedings for the assessment year 2020-21 has been extended. The assessment for the assessment year 2020-21 (financial year 2019-20) was to be completed by March 31, 2022, whose deadline has now been extended to September 30, 2022.
Crypto loss cannot be adjusted against crypto gain
While introducing the amendment to the Finance Bill, the government clarified that the loss in one cryptocurrency cannot be set off from the gain in another. For example, if you make a profit of Rs 100 from bitcoin and a loss of Rs 70 in ethereum, then you will have to pay tax only on the profit of Rs 100 and not on your net profit of Rs 30. This rate of tax is 30 percent excluding surcharge and cess. Not only this, you will also not be able to adjust the profit and loss in the cryptocurrency against the profit or loss from other assets like shares, mutual funds and real estate.