Income Tax Returns (ITR):Don’t Forget to File for FY 2024-25 (AY 2025-26)

by

Income Tax Return(ITR) is a crucial financial obligation for Indian taxpayers. To improve efficiency, increase transparency, and accommodate new tax laws, the Income Tax Department has implemented a number of updates for the Financial Year (FY) 2024–2025, which corresponds to the Assessment Year (AY) 2025–2026. Everything you need to know about filing your ITR for 2025 will be covered in this comprehensive guide, including deadlines, eligibility, forms, important changes, step-by-step instructions, and advice on how to avoid common pitfalls.

ITR

Understanding ITR Filing

What is ITR Filing?

Declaring your income, deductions, exemptions, and taxes paid to the Income Tax Department for a given fiscal year is known as filing an income tax return, or ITR. The period from April 1 to March 31 is known as the financial year (FY), and the assessment year (AY) is the year after which your income is evaluated and subject to taxes. For instance, AY 2025–2026 is used to assess income earned from April 1, 2024, to March 31, 2025 (FY 2024–25).

Why File ITR?

Filing ITR is not just a legal obligation but also offers several benefits:

  • Compliance: Ensures adherence to the Income Tax Act, 1961, avoiding penalties and legal notices.
  • Refunds: Enables you to claim refunds for excess tax paid or deducted (e.g., TDS).
  • Financial Proof: Serves as proof of income for loans, visas, or other financial transactions.
  • Loss Carry-Forward: Allows you to carry forward losses (e.g., from stock markets or business) to offset future income, provided the Return is filed on time.
  • Transparency: Promotes financial transparency and accountability.

Key Deadlines for ITR Filing in 2025

The ITR filing deadline for FY 2024–25 (AY 2025–26) has been extended by the Central Board of Direct Taxes (CBDT) to account for major modifications to return forms and system upgrades. The important deadlines are as follows:

  • Non-Audit Cases: (Extended from July 31, 2025) September 15, 2025. This pertains to individuals, Associations of Persons (AOPs), Bodies of Individuals (BOIs), and Hindu Undivided Families (HUFs) whose financial records don’t need to be audited.
  • Audit Cases: October 31, 2025, for professionals or companies that need a tax audit under the Income Tax Act. The deadline for submitting the audit report is September 30, 2025..
  • Companies with International Transactions: November 30, 2025, for organizations obligated by Section 92E to submit a report in Form 3CEB.
  • Belated or Revised Returns: December 31, 2025. Filing after September 15, 2025, incurs late fees under Section 234F: ₹5,000 for incomes above ₹5 lakh, or ₹1,000 for incomes below ₹5 lakh.
  • Updated Returns (ITR-U): Can be filed until March 31, 2030, for corrections or omissions, with additional tax liabilities of up to 50% on the additional tax and interest payable.

Note: Despite the extended filing deadline, self-assessment tax must be paid by July 31, 2025, in order to avoid interest under Section 234A.

Who Needs to File ITR?

You are required to file a Return if:

  • Your taxable income is more than the basic exemption threshold, which was ₹2.5 lakh under the previous regime and ₹3 lakh under the current one for people under 60.
  • You make money from your job or business.
  • You own foreign assets, have foreign income, or have capital gains.
  • You want to carry forward losses that you have incurred, such as from business or stock markets.
  • You fulfill certain requirements, like owning unlisted equity shares, serving as a director of the company, or earning more than ₹5,000 from agriculture.
  • The Income Tax Department has sent you a notice (for example, under Section 142(1) or 158BC).

Exemption: Senior citizens (above 75 years) with only pension and interest income, and no business income, may be exempt under certain conditions.

Choosing the Right Form

For accurate filing, choosing the appropriate ITR form is essential. For AY 2025–2026, the Income Tax Department has made a number of ITR forms available, each of which serves a distinct taxpayer category and income type. This is a summary:

  • ITR-1 (Sahaj): For resident individuals with income up to ₹50 lakh from salary, one house property, and other sources (e.g., interest, dividends). Not applicable for those with business income or capital gains.
  • ITR-2: For individuals and HUFs with income from salary, multiple house properties, capital gains, foreign assets, or other sources, but not from business or profession. Suitable for company directors or holders of unlisted equity shares.
  • ITR-3: For individuals and HUFs with income from business or profession (e.g., proprietorship, consultancy, freelancing) or partnership firms. It’s more complex, covering capital gains and other income sources.
  • ITR-4 (Sugam): For resident individuals, HUFs, and partnership firms opting for presumptive taxation under Sections 44AD, 44ADA, or 44AE, with total income up to ₹50 lakh (or ₹75 lakh for professionals with 95% digital receipts).
  • ITR-5, ITR-6, ITR-7: For firms, companies, trusts, and other entities.

Tip: Use the Income Tax Portal’s pre-filled data feature to determine the appropriate form based on your income sources.

Key Updates for AY 2025-26

The Finance Act, 2024, and CBDT notifications have introduced several changes for Return filing in 2025. Here are the highlights:

  1. New Tax Regime as Default: All taxpayers (individuals, HUFs, AOPs, BOIs, etc.) are now required to pay taxes under the new tax regime, which has lower tax rates but fewer exemptions. Non-business taxpayers have until September 15, 2025, to select the old regime in their ITR. Form 10-IEA must be submitted by business taxpayers prior to the deadline.
  2. Capital Gains Reporting: Short-Term Capital Gains (STCG) tax is 20% (previously 15%) and Long-Term Capital Gains (LTCG) tax is 12.5% (previously 10%) for shares and mutual funds sold on or after July 23, 2024. Gains before and after this date must be reported separately by taxpayers in Schedule CG of ITR-2 and ITR-3.
  3. Asset Disclosure Threshold: The threshold for reporting assets and liabilities in ITR-2 and ITR-3 has increased to ₹1 crore from ₹50 lakh.
  4. Deduction Details: Enhanced reporting for deductions under Sections 80C, 80D, 80DD, 80U, etc., requiring details like policy numbers, insurer names, or Form 10IA acknowledgment numbers for disabilities.
  5. Updated Returns (ITR-U): Available for AY 2021-22 and AY 2022-23 for ITR-3 and ITR-4 to correct errors, with additional tax liabilities.
  6. Excel Utilities: Offline utilities for ITR-1, ITR-2, ITR-3, ITR-4, and ITR-5 are available, allowing taxpayers to generate JSON files for upload.

Step-by-Step Guide to Filing ITR Online

Filing ITR online via the Income Tax Portal (https://incometax.gov.in) is straightforward. Follow these steps:

  1. Gather Documents:
    • Form 16: For salaried individuals, detailing salary and TDS.
    • Form 26AS: To verify TDS and tax credits.
    • Annual Information Statement (AIS): For comprehensive income and transaction details.
    • Bank Statements: To report interest income and verify transactions.
    • Investment Proofs: For deductions under Sections 80C, 80D, etc.
    • Capital Gains Details: Sale/purchase documents for shares, mutual funds, or property.
    • Aadhaar and PAN: Linked for verification.
  2. Log In to the Portal:
    • Visit https://incometax.gov.in and log in using your PAN and password.
    • Select AY 2025-26 and choose “Online” mode.
  3. Select the Right ITR Form:
    • Choose your status (Individual, HUF, etc.) and the appropriate ITR form based on your income sources.
  4. Fill in Details:
    • Personal Information: Verify pre-filled data (PAN, Aadhaar, address, bank details).
    • Income Details: Enter income from salary, house property, capital gains, or business, using Form 26AS and AIS for accuracy.
    • Deductions: Claim deductions under Sections 80C, 80D, 80DD, etc., with supporting details.
    • Tax Paid: Verify TDS and advance tax details.
  5. Validate and Preview:
    • Check calculations for income, tax, and refunds. Download the JSON file after validation.
  6. Submit and E-Verify:
    • Upload the JSON file, submit the return, and e-verify using Aadhaar OTP, net banking, or digital signature. E-verification is mandatory; failure to verify invalidates the return.

Filing ITR Offline Using Excel Utility

For complex returns or limited internet access, use the offline Excel utility:

  1. Download the utility for your ITR form from the Income Tax Portal’s “Downloads” section.
  2. Select “File Return” and download pre-filled data using your PAN and AY 2025-26.
  3. Enter personal, income, and deduction details in the utility.
  4. Validate and generate a JSON file.
  5. Log in to the portal, upload the JSON file under “File Now,” and e-verify.

Common Mistakes to Avoid

  • Incorrect ITR Form: Choosing the wrong form leads to rejection or scrutiny.
  • Missing Deadlines: Late filing incurs penalties and loss of carry-forward benefits.
  • Inaccurate Data: Discrepancies with Form 26AS or AIS can trigger notices.
  • Not E-Verifying: Returns are invalid without e-verification.
  • Ignoring New Rules: Failing to report capital gains separately or missing deduction details can lead to errors.
  • Not Opting for Old Regime: If you prefer the old regime, explicitly choose it by the due date, or the new regime applies automatically.

Penalties for Non-Compliance

  • Late Filing Fees: ₹5,000 (income > ₹5 lakh) or ₹1,000 (income ≤ ₹5 lakh) under Section 234F.
  • Interest: 1% per month on unpaid tax under Section 234A for belated returns.
  • Loss of Benefits: Inability to carry forward losses if filed late.
  • Scrutiny Notices: Mandatory scrutiny for high-risk cases or discrepancies.

Tips for a Smooth ITR Filing Experience

  • File Early: Avoid last-minute hassles by filing before September 15, 2025.
  • Use Pre-Filled Data: Leverage the portal’s pre-filled data to minimize errors.
  • Cross-Check Documents: Verify Form 16, Form 26AS, and AIS for accuracy.
  • Seek Expert Help: For complex returns (e.g., ITR-3), consider consulting a chartered accountant or using platforms like ClearTax or Tax2win.
  • Keep Records: Maintain documents for at least 7 years, as the tax department may request them during assessments.
  • Stay Updated: Check the Income Tax Department’s website or social media for announcements on forms and utilities.

Special Considerations

  • New Income Tax Bill 2025: A revised Income Tax Bill is set to replace the Income Tax Act, 1961, with changes to terminology, TDS/TCS provisions, and more. Stay informed via official sources or podcasts by the Income Tax Department.
  • Foreign Assets: Mandatory reporting of foreign assets or accounts, regardless of income, to ensure compliance.
  • Refunds: Typically processed within 30-40 days after e-verification. Check status under “My Account” > “Refund/Demand Status.”

Conclusion

One of the most important steps in meeting your tax obligations and receiving financial benefits is filing your ITR for FY 2024-25 (AY 2025-26). For non-audit cases, the deadline has been extended to September 15, 2025, giving taxpayers enough time to collect supporting documentation, select the appropriate form, and file correctly. The process is easy to use thanks to the Income Tax Department’s updated portal, pre-filled data, and offline tools. You can prevent fines and guarantee a hassle-free experience by keeping up with updates, double-checking information, and filing early.

Visit https://incometax.gov.in or speak with a tax expert for more help. Enjoy peace of mind, stay compliant, and file early!

Leave a Comment

Table of Contents

→ Index