Income Tax: Last date to file ITR looms closer, taxpayers can make note of 5 key points
Income Tax: Only two months are remaining before the deadline to file income tax return (ITR) for FY 2024-25 expires on September 15, 2025.
Last week, the income tax department released excel utilities of ITR-2 and ITR-3 which means those taxpayers who have capital gain or crypto income can also begin to file their return for the financial year ending March 31, 2025. Salaried taxpayers should make note of the following points.
Filing ITR: Key points to note
I. Form to choose: At the outset, taxpayers must choose the right income tax form.
ITR-1: This is meant for salaried taxpayers who have income up to ₹50 lakh, income from house property, capital gain income up to ₹1.25 lakh and interest income from fixed deposits (FDs) or dividend income.
ITR-2: This form is meant for resident individuals with salary or pension income exceeding ₹50 lakh, own more than one house property, agricultural income upto ₹5,000, capital gains and income from other sources.
ITR-3: This tax form is meant for the individual and HUF who earn an income from the profits and gains of business or profession.
ITR-4: It is meant for those taxpayers who are running a business and have opted for the presumptive taxation scheme under sections 44AD, 44ADA, and 44AE. Regardless of whether they have salary income or not, taxpayers can file their returns using Form ITR-4.
II. Deductions to claim: Make sure that you claim those deductions which you are entitled to. Lately, income tax department has cracked down on a number of taxpayers for making fraudulent claims of deductions and exemptions in income tax under different provisions such as under sections 10(13A), 80GGC, 80E, 80D, 80EE, 80EEB, 80G, 80GGA and 80DDB.
III. Expert advice: Another point worth noting is that although one can file his/her tax return without engaging an expert, it is advisable to seek expert advice to be certain about the provisions which are complex or open to interpretation.
IV. Tax regime to choose: Another pertinent decision to make is to choose the tax regime. Before filing your return, you need to make sure you opt for the regime that suits you. If you are set to claim a number of deductions and exemptions, it is recommended to opt for the old tax regime otherwise you can go for the new tax regime.
Read this article on Livemint where BDO India’s Preeti Sharma says that inquiry from the tax department is higher in case of the old tax regime.
You can even check your income tax computation as per both the regimes on income tax calculator here.
V. Cross verify: Additionally, taxpayers should cross verify the TDS information given on form 16 with that on form 26AS. It is a statement that provides details of any amount deducted as TDS or TCS from various sources of income of a taxpayer including salary and interest on savings & FDs.
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