Income Tax Filing 2025: Key Changes Introduced in ITR Forms for FY 2024-25

Income Tax Filing 2025: Key Changes Introduced in ITR Forms for FY 2024-25

The Central Board of Direct Taxes (CBDT) has notified the new Income Tax Return (ITR) forms for e-filing for the Financial Year 2024-25 (Assessment Year 2025-26). Several important changes have been introduced this year across ITR-1 to ITR-6, aimed at simplifying compliance and enhancing reporting transparency.

Here’s a comprehensive overview of the key changes in each ITR form:

1. ITR-1 (Sahaj) and ITR-4 (Sugam): Expanded Eligibility & Enhanced Reporting

What’s New:

  • Capital Gains Inclusion: Taxpayers can now file ITR-1 or ITR-4 even if they have long-term capital gains (LTCG) under Section 112A, provided the gains do not exceed ₹1.25 lakh and there is no carry forward or brought forward loss.

  • Improved Deduction Details: New fields introduced to capture specific deductions claimed under various sections of the Income Tax Act.

  • Detailed TDS Reporting: The Schedule-TDS will now capture the provision under which TDS is deducted.

itr

2. ITR-2: Capital Gains and Asset Reporting Enhancements

Key Highlights:

  • Capital Gains Segregation: A new split has been introduced to report capital gains before and after July 23, 2024, in line with changes made by the Finance Act, 2024.

  • Buyback Loss Adjustments: Capital loss from share buyback is now permitted if the corresponding dividend income is reported under ‘Income from Other Sources’ (applicable post October 1, 2024).

  • Asset & Liability Threshold Raised: Individuals with total income exceeding ₹1 crore must now provide asset and liability details.

  • Enhanced Deduction Reporting: Improvements in how deductions under Section 80C and Section 10(13A) are captured.

3. ITR-3: Capital Gains Rationalisation

Updated Aspects:

  • Rationalisation of Holding Periods: Holding periods for certain asset classes have been modified.

  • Capital Gains Tax Rates Streamlined: Changes made to LTCG and STCG rates for better consistency and ease of computation.

  • Indexation Adjustments: Rules related to indexation of long-term capital assets have been fine-tuned.

4. ITR-5: Changes for Firms, LLPs, and Other Entities

Form Updates Include:

  • Capital Gains Split: Gains must now be reported distinctly before and after July 23, 2024, per Finance Act, 2024.

  • Buyback Loss Reporting: Allowed where dividend income is declared as ‘Other Sources’ (applicable post October 1, 2024).

  • New Section Included: Section 44BBC, which deals with income from the cruise business, has been added.

  • TDS Disclosure Enhanced: Section codes under which TDS is deducted must be reported in Schedule-TDS.

itr

5. ITR-6: Corporate Taxpayer Updates

Notified on: May 6, 2025

Major Changes:

  • Capital Gains Segregation: As with other forms, capital gains must be split around July 23, 2024.

  • Buyback Loss Provisions: Applicable similar to ITR-2 and ITR-5 post October 2024.

  • Section 44BBC: Income from cruise business now included for disclosure.

  • Schedule BP (Business Profits): As per Rule 10TIA, profits from raw diamond sales must be at least 4% of gross receipts.

  • Home Loan Interest Deduction: Deductions under Section 24(b) (interest on housing loan) are now explicitly captured.

  • Schedule-TDS: Reporting of TDS section codes made mandatory.

Read More: ITR Filing Update: ITR-6 Form for Companies Now Notified

The 2025 ITR forms reflect the government’s continued focus on data precision, expanded eligibility, and compliance streamlining. Taxpayers and professionals must familiarize themselves with these changes to ensure accurate and timely filing.

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ITR Filing Update: ITR-6 Form for Companies Now Notified

ITR-6

ITR Filing Update: ITR-6 Form for Companies Now Notified

ITR-6

The Central Board of Direct Taxes (CBDT) has officially notified Income Tax Return Form ITR-6, meant exclusively for companies not claiming exemption under Section 11 of the Income Tax Act (i.e., companies other than those engaged in charitable or religious activities).

This update comes as part of the government’s effort to streamline tax compliance and reporting for the financial year 2024-25 (Assessment Year 2025-26). The ITR-6 form enables companies to report income, claim deductions, and compute taxes payable under the applicable provisions.

🔍 Who Should File ITR-6?

ITR-6 is applicable to all companies registered under the Companies Act—excluding those claiming tax exemption under Section 11. It is primarily meant for private limited, public limited, and other domestic companies engaged in business or professional activities.

✅ Key Updates in ITR-6 for AY 2025-26

The newly notified ITR-6 form incorporates several updates aligned with recent amendments introduced in the Finance Act, 2024. According to details shared by the Income Tax Department, the key changes include:

  1. Capital Gains Reporting Enhanced

    • The Schedule-CG (Capital Gains) has been revised to segregate gains before and after July 23, 2024, reflecting the new provisions introduced in the Finance Act.

  2. Buyback Loss Allowance

    • From October 1, 2024, capital loss incurred on share buyback will be permitted only if the corresponding dividend income is disclosed under ‘Income from Other Sources’.

  3. Section 44BBC Referenced

    • A reference to Section 44BBC, which deals with income computation for cruise shipping businesses, has now been added.

  4. Change in Schedule BP (Business Profits)

    • As per Rule 10TIA, profits from the sale of raw diamonds must now be declared at a minimum of 4% of gross receipts.

  5. Deduction under Section 24(b)

    • Enhancements have been made to accurately capture interest deduction claims on borrowed capital for house property.

  6. TDS Reporting Streamlined

    • In Schedule-TDS, companies must now mention the TDS section code, allowing for more precise reconciliation.

📌 Other ITR Forms Already Notified

Prior to ITR-6, the Income Tax Department had already released the following ITR forms for FY 2024-25:

  • ITR-1 (Sahaj) and ITR-4 (Sugam) – Notified on April 29, 2025

  • ITR-3 – Released on April 30, 2025

  • ITR-5 – Issued on May 2, 2025

  • ITR-2 – Announced on May 3, 2025

ITR-6

🗓️ Important Filing Deadlines

  • July 31, 2025: Due date for non-audit companies

  • October 31, 2025: Due date for companies requiring audit

Businesses are advised to begin preparations early to avoid last-minute hassles and ensure timely and accurate compliance.

Read More: ITR-2 Form Update for AY 2025-26: Eligibility and Key Changes

With the notification of ITR-6, the complete set of ITR forms for FY 2024-25 is now available for filing. Companies must pay close attention to the new disclosures, especially regarding capital gains, buyback losses, and raw diamond sales, to avoid compliance risks.

For professional support in company taxation or filing ITR-6, consult an experienced tax advisor or chartered accountant.

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Top 5 Mistakes to Avoid While Filing Your Income Tax Return for AY 2025–26

ITR

Top 5 Mistakes to Avoid While Filing Your Income Tax Return for AY 2025–26

ITR

As the deadline for filing Income Tax Returns (ITR) for the Assessment Year 2025–26 approaches, individual taxpayers are busy gathering key financial documents—salary slips, bank statements, dividend records, capital gains summaries, and other income-related details from the financial year 2024–25.

Filing your tax return accurately and on time is not just about compliance—it’s about avoiding penalties, unnecessary notices, and delays. Small oversights can lead to big complications, including scrutiny from tax authorities, financial penalties, and loss of certain tax benefits.

Here are the top five common mistakes you must steer clear of to ensure a hassle-free ITR filing experience this year:

1. Missing the ITR Filing Deadline

The due date for most individual taxpayers to file their return is July 31, 2025. Missing this deadline may attract late filing fees ranging from ₹1,000 to ₹10,000, depending on your total income and the delay in filing. Furthermore, filing after the due date can cause loss of certain deductions and prevent you from carrying forward specific losses, such as capital losses.

Tip: Set reminders or work with a tax advisor early to ensure your return is filed well before the deadline.

2. Choosing the Wrong ITR Form

Filing your return using the incorrect form is a common yet critical error. For instance:

  • ITR-1 is applicable for salaried individuals with total income up to ₹50 lakhs and one house property.

  • ITR-2 is suitable for individuals having capital gains or owning multiple house properties.

Filing with the wrong form may lead to return rejection, delayed processing, or even legal notices.

Tip: Refer to the latest ITR form guide from the Income Tax Department or consult a professional to determine the correct form for your profile.

3. Not Reporting All Sources of Income

Every income source—no matter how small—must be reported. This includes:

  • Interest from savings accounts or fixed deposits

  • Dividends from stocks or mutual funds

  • Rental income from property

  • Capital gains, even from minor trades

Failure to report any such income could result in penalties and scrutiny.

Tip: Review all bank accounts (including dormant ones), demat statements, and AIS/Form 26AS to ensure no income is overlooked.

4. Ignoring Form 26AS and Annual Information Statement (AIS)

These two documents are essential tools for cross-verifying your income and TDS details:

  • Form 26AS shows tax deducted at source, advance tax paid, and high-value transactions.

  • AIS provides an extended snapshot of all financial transactions linked to your PAN.

Mismatch between these records and your ITR can trigger notices or delay in refund processing.

Tip: Always reconcile your tax filing data with both Form 26AS and AIS before submission.

ITR

5. Not Verifying Your ITR After Filing

Many taxpayers file their return but forget to complete the final step: verification. An unverified ITR is treated as invalid by the Income Tax Department.

Verification can be done through:

  • Aadhaar-based OTP

  • Net banking

  • Digital signature

  • Offline submission of ITR-V (if needed)

Tip: Complete the verification within 30 days of filing to ensure your return is processed.

Read More: ITR-2 Form Update for AY 2025-26: Eligibility and Key Changes

Accuracy, timeliness, and thoroughness are key to a smooth tax filing experience. Double-checking your documents, choosing the right form, reporting all income sources, and completing the verification process can save you from major hassles.

By avoiding these five common mistakes, you can not only stay compliant but also ensure that your refund (if any) is processed faster and your record remains clean with the tax authorities.

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