Your Complete Guide to Filing Income Tax Returns for FY 2024-25
FINANCE
As the tax season for the Financial Year (FY) 2024-25 (Assessment Year (AY) 2025-26) approaches, understanding the nuances of Income Tax Return (ITR) filing is essential for every taxpayer in India. Whether you're a salaried professional, a freelancer, or a business owner, this guide breaks down the key aspects of ITR filing, deadlines, forms, recent changes, and tips to ensure a smooth process.
Why File Your ITR on time?
Filing your ITR on time is not just a legal obligation but also a financial necessity. It helps you:
Avoid Penalties: Late filing can attract a fee of up to ₹5,000 and interest on unpaid taxes.
Claim Refunds: Get back excess taxes paid through TDS or advance tax.
Build Financial Credibility: ITRs are crucial for loan approvals, visa applications, and government tenders.
Comply with the Law: Avoid scrutiny or notices from the Income Tax Department.
Key Deadlines for AY 2025-26
Mark these important dates to stay compliant:
July 31, 2025: Deadline for individuals, HUFs, and entities not requiring an audit (e.g., salaried individuals, freelancers, or small businesses with income up to ₹50 lakh).
September 30, 2025: Due date for submitting tax audit reports for businesses/professionals requiring an audit.
October 31, 2025: ITR filing deadline for audit cases.
November 30, 2025: Deadline for entities with international transactions requiring transfer pricing reports.
December 31, 2025: Last date to file belated or revised returns.
March 31, 2030: Extended deadline for filing updated returns (ITR-U) to report additional income, with additional tax liabilities (25% or 50% based on timing).
Missing the July 31 deadline incurs a late filing fee of ₹5,000 (₹1,000 if income is below ₹5 lakh) under Section 234F, plus 1% monthly interest on unpaid taxes under Section 234A.
Which ITR Form Should You Use?
The Central Board of Direct Taxes (CBDT) has notified seven ITR forms for AY 2025-26, each tailored to specific taxpayer categories:
ITR-1 (Sahaj): For resident individuals with total income up to ₹50 lakh from:
Salary or pension
One house property
Other sources (e.g., interest)
Long-term capital gains (LTCG) up to ₹1.25 lakh from listed shares/equity mutual funds (Section 112A)
Agricultural income up to ₹5,000 Not for: Directors, unlisted equity shareholders, or those with foreign assets.
ITR-2: For individuals/HUFs with income exceeding ₹50 lakh, capital gains, or foreign assets, but no business/profession income. Includes new fields for capital gains before/after July 23, 2024, and buyback loss reporting from October 1, 2024.
ITR-3: For individuals/HUFs with income from a proprietary business or profession.
ITR-4 (Sugam): For individuals, HUFs, and firms (not LLPs) with income up to ₹50 lakh under presumptive taxation, salary, one house property, or other sources.
ITR-5: For partnerships, LLPs, and cooperative societies.
ITR-6: For companies registered under the Companies Act.
ITR-7: For trusts, charities, political parties, or entities under Sections 139(4A), 139(4B), etc.
Pro Tip: Check your income sources and eligibility carefully to choose the right form. Using the wrong form can lead to defective return notices.
Major Changes for AY 2025-26
The Union Budget 2025 and CBDT updates introduced several changes to simplify and streamline ITR filing:
New Tax Regime as Default: The new tax regime (with lower rates but fewer deductions) is now the default. To opt for the old regime, file Form 10-IEA before the due date (July 31, 2025, for non-business cases). For business income, opting out is a one-time choice.
Capital Gains Simplification: ITR-1 and ITR-4 now allow reporting LTCG up to ₹1.25 lakh under Section 112A, making it easier for small investors to file without switching to ITR-2.
Asset Reporting Threshold: ITR-2 now requires reporting of assets and liabilities only if the total income exceeds ₹1 crore.
Updated Return Extension: The window for filing updated returns (ITR-U) has been extended to 4 years (until March 31, 2030), but with additional tax liabilities.
Enhanced ITR-2 Utility: Includes features for revised returns under Section 139(8A).
Tax Slabs for AY 2025-26
New Tax Regime (Default)
Up to ₹3 lakh: Nil
₹3 lakh–₹7 lakh: 5% (with full rebate under Section 87A, so no tax up to ₹7 lakh)
₹7 lakh–₹10 lakh: 10%
₹10 lakh–₹12 lakh: 15% (rebate of ₹60,000 ensures no tax liability)
₹12 lakh–₹15 lakh: 20%
Above ₹15 lakh: 30%
Old Tax Regime
Up to ₹2.5 lakh (below 60 years): Nil
Up to ₹3 lakh (60–79 years): Nil
Up to ₹5 lakh (80+ years): Nil
₹2.5 lakh–₹5 lakh: 5% (rebate under Section 87A up to ₹5 lakh income)
₹5 lakh–₹10 lakh: 20%
Above ₹10 lakh: 30%
How to File Your ITR
Gather Documents:
PAN and Aadhaar cards
Form 16 (from employer), Form 16A (TDS on other income)
Form 26AS and Annual Information Statement (AIS) for tax credit verification
Salary slips, interest certificates, capital gains details
Proof of deductions/investments (e.g., Section 80C, 80D)
File Online:
Visit the Income Tax Department’s e-filing portal (incometax.gov.in).
Log in with PAN/Aadhaar, select AY 2025-26, and choose the appropriate ITR form.
Enter income details, claim deductions, and compute tax.
E-verify using Aadhaar OTP, net banking, or digital signature to complete the process.
Use Expert Platforms: Platforms like ClearTax or IndiaFilings offer user-friendly interfaces and professional assistance for error-free filing.
Pro Tip: Pre-validate your bank account and link it to your PAN for faster refunds (typically processed within 7–20 days).
Penalties for Non-Compliance
Late Filing: ₹5,000 (₹1,000 if income < ₹5 lakh) under Section 234F, plus 1% monthly interest on unpaid taxes under Section 234A.
Under-Reporting Income: Penalty up to 200% of the tax payable.
Belated Filing: Disqualifies carrying forward certain losses (e.g., capital or business losses)
Special Notes for Non-Residents
Non-resident individuals with income exceeding ₹15 lakh (excluding foreign sources) may be deemed residents if not taxed elsewhere. They must file ITR if applicable, with provisions for foreign tax credits via Form 67.
Tips for a Hassle-Free ITR Filing
Start Early: The e-filing portal typically opens in April 2025. Filing early avoids last-minute glitches.
Verify Data: Cross-check income and tax details with Form 26AS and AIS.
Consult Professionals: For complex cases (e.g., foreign income, capital gains), seek expert advice.
E-Verify Promptly: Complete verification to avoid invalid returns.
Keep Records: Maintain digital/physical copies of filed ITRs and acknowledgments.
Conclusion
Filing your ITR for AY 2025-26 doesn’t have to be daunting. By understanding the deadlines, choosing the right form, and leveraging the new tax regime’s benefits, you can ensure compliance and maximize refunds. For detailed guidance or assistance, visit incometax.gov.in or consult trusted platforms like ClearTax or IndiaFilings.
Stay proactive, file on time, and keep your financial records in order. Happy filing!