Life is getting simpler for the taxpayer. The new forms for filing income tax return for assessment year 2007-08 (financial year 2006-07) seeks to make things easier.

For the salaried class, the great news is that the complicated Form 2F that sought all kinds of documents and expenditure and cash flows is out.

But in its place, there are two new forms: a two-page ITR-1 and a more elaborate version, seven-pager ITR-2.

The two-pager ITR-1 is for individuals, who derive their income from salary, pension and interest only. On the other hand, the seven-pager ITR-2 is for individuals and Hindu Undivided Family who also have income from heads other than the three (for example, house property or capital gains) and who have to club someone else's income (that is, income of spouse or minor children) with theirs.

The unique feature in the new system is that, even the famous Form 16 is not required to be attached. Also, the tax department has taken it a step further by instructing officials to detach all documents enclosed and return them to the taxpayers. Of course, there are certain checks and balances that have been incorporated in this regime. These include details of

• Cash deposits of Rs 10 lakh (Rs 1 million) or more in a savings bank account
• Payment of Rs 200,000 or more on a credit card
• Purchase or sale of immovable property valued at Rs 30 lakh (Rs 3 million) or more
• Payment of over Rs 200,000 and more made towards investment in a mutual fund in a single year, Rs 500,000 in RBI bonds, corporate bonds and debentures, or Rs 100,000 in shares.

Needless to clarify, these monetary limits apply to the aggregate payments in the year. The return of income required to be furnished in forms ITR-1 to ITR-6 or ITR-8 is not to be accompanied by any statement showing the computation of the tax payable on the basis of the return, or proof of the tax, deducted at source or the advance tax. Returns of income may be furnished in any of the following manner:

In the paper form

• Electronically under digital signature
• Electronically and thereafter, submitting the verification of the return in Form ITR-V
• Bar-coded return in a paper form

However, a firm is required to furnish the return in form ITR-5 and to whom provisions of tax audit are applicable. A company is required to furnish the return in form ITR-6 and have to furnish the return in a paper form or transmit the data electronically and thereafter, submit the verification of the return in form ITR-V. Also, anyone filing the returns in the form ITR-7 format has to furnish the details in a paper form.

The director-general of IT (systems) has been entrusted with a duty to specify the procedures, formats and standards for ensuring secure capture and transmission of data. He also has been given the additional responsibility of evolving and implementing appropriate security, archival and retrieval policies, in relation to furnishing the returns in a paper form or transmitting the data of the return electronically.

Finally, the due date of filing tax returns is dependent upon the nature of income and status of the tax payer and whether tax audit is applicable for the tax payer.

Accordingly, if the taxpayer is a company or a person whose accounts are to be audited, the due date is October 31, 2007. For all other tax payers, the due date is July 31, 2007 for assessment year 2007-08.