All taxpayers, except trusts and non-profit organisations, can file returns with the proposed new common ITR form, on which the Central Board of Direct Taxes (CBDT) has invited stakeholder comments by 15 December.

Currently, taxpayers are required to furnish their income tax returns in ITR-1 to ITR-7 depending upon the category. 

“The current ITRs are in the form of designated forms wherein the taxpayer is mandatorily required to go through all the schedules, irrespective of the fact whether that particular schedule is applicable or not, which increases the time taken to file the ITRs," the finance ministry said in a statement.

“The proposed draft ITR takes a relook at the return filing system in tandem with international best practices. It proposes to introduce a common ITR by merging all the existing returns of income except ITR-7," it said.

However, the current ITR-1 and ITR-4 will continue. This will give an option to such taxpayers to file the return either in the existing form (ITR-1 or ITR-4), or the proposed common ITR, at their convenience. 

Here's the scheme of the proposed common ITR:

- Basic information (comprising parts A to E), Schedule for computation of total income (Schedule TI), Schedule for computation of tax (schedule TTI), Details of bank accounts, and a schedule for the tax payments (schedule TXP) is applicable for all taxpayers.

- The ITR is customized for taxpayers with applicable schedules based on certain questions answered by the taxpayers (wizard questions).

- The questions have been designed in such a manner and order that if the answer to any question is ‘no’, the other questions linked to this question will not be shown to the taxpayer.

- Instructions have been added to assist the filing of the return containing the directions regarding the applicable schedules.

- The proposed ITR has been designed in such a manner that each row contains one distinct value only. This will simplify the return filing process.

- The utility for the ITR will be rolled out in such a manner that only applicable fields of the schedule will be visible and wherever necessary, the set of fields will appear more than once.

Nangia Andersen LLP Partner Sandeep Jhunjhunwala said taxpayers filing return of income in Forms ITR-2, ITR-3, ITR-5 and ITR-6 would not have an option to file the old forms, once the new common form and related utility are notified.

"Contemporary reporting requirements such as pass through income or loss under various heads, income from virtual digital assets, declaration and details of Business Connection, Permanent Establishment and Significant Economic Presence in India for non-residents, and details of foreign equity and debt interest held remain key highlights of the new common ITR form," Jhunjhunwala added.