1. What is Schedule AL?
Schedule AL enables a taxpayer to disclose assets and the corresponding liabilities in the ITR filed by the taxpayer. The values of the assets and liabilities standing at the end of the year are required to be disclosed in the schedule AL. The assets to be disclosed include immovable property, movable property and financial assets owned by the taxpayer. The liabilities include all liabilities of the taxpayer in relation to such assets.
2. Who should file Schedule AL?
Individuals and Hindu undivided families (HUF) having total income below Rs 50 lakh are not required to file schedule AL. But, individuals and HUFs having an annual income exceeding Rs 50 lakh must mandatorily file Schedule AL. Separately, individuals and HUFs carrying on any business or profession are required to file details of assets and liabilities through a Balance Sheet.
The schedule AL is required to be filled by taxpayers filing ITR-2 which includes taxpayers having income above Rs 50 lakh. All other cases of taxpayers filing ITR-2 should also fill up schedule AL such as taxpayers holding directorships in any company. In a similar case, where total income exceeds Rs 50 lakh, taxpayer filing ITR-3 should also fill in schedule AL. This is in addition to the Balance Sheet of the business or profession to be filed in ITR-3.
3. Should my gross income be within the limit?
Your income after all the deductions (net income) under Chapter-VI-A must be within the specified limit of Rs 50 lakh. If the net income exceeds Rs 50 lakh, you must file Schedule AL.
For better understanding, consider the case of Pinky Sharma. Her gross income per annum is Rs 53 lakh. However, she gets a tax deduction of Rs 1.5 lakh for investments and expenditures under Section 80C and 80D. In addition, she has been paying home loan instalments and qualifies for the deduction on home loan interest of Rs 1.5 lakh per annum. This brings down her net income to Rs 50 lakh. Now, she is not required to file Schedule AL in her ITR.
If she did not have to pay the home loan instalments, she would not get the deduction on interest payment. In that case, the net income would amount to Rs 51.5 lakh. This income would exceed the threshold limit of Rs 50 lakh. Consequently, it would be mandatory for Pinky to file Schedule AL.
4. Guidelines to file Schedule AL
Here are a few guidelines you must comply to while filing Schedule AL:
a. The cost of such asset must be declared as per the cost provided by the previous owner plus the cost of any improvement incurred by the previous owner.
b. If the cost of such asset is not ascertainable and no wealth tax return was filed for that asset, the value can be estimated at the circle rate or bullion rate as per the date of acquisition by the assessee.
a. Housing loan
b. Vehicle loan
c. Personal loan
Frequently Asked Questions
I have income from salary and interest income and income is more than Rs.50,00,000 after deductions, can I file ITR 1?
No, since your income is more than Rs. 50,00,000 you need to file ITR2 and not iTR 1 even though you have only salary and interest income.
I am a non-resident and have taxable income of more than Rs.50,00,000 is schedule AL applicable for non residents also ?
Yes, schedule Al is applicable irrespective of residential status to all all individuals and HUFs if the taxable income exceeds Rs.50,00,000