ITR 2025: The Income Tax Department has notified all forms from ITR-1 to ITR-7 for the financial year 2024-25. ITR-1 to ITR-4 are used for small and medium taxpayers, while ITR-7 is important for trusts and charitable institutions. This time the tax department has made an important change in ITR-1 and ITR-4, which will affect salaried taxpayers and small business taxpayers.
The rules related to LTCG have changed
Actually, the Income Tax Department has changed the rules of long term capital gain (LTCG) from shares and mutual funds listed in the stock market. According to the new rule, if a taxpayer’s income is up to Rs 1.25 lakh, then he can file ITR-1 or ITR-4. Earlier, individuals or entities had to file ITR-2. According to the income tax rules, there is no tax on long term capital gain up to Rs 1.25 lakh in a year, while if it exceeds the limit, a tax of 12.5 percent has to be paid.
Rules changed for these forms as well
At the same time, the Income Tax Department has also made some changes to rationalize the capital gain tax in ITR Form-2,3,5,6 and 7. In the Schedule Capital Gain of ITR, now the capital gain will be divided into two parts. First, separate tax calculations will be done on the gains before 23 July 2024 and after that.
Capital gains tax on real estate reduced
Let us tell you that while presenting the budget for the financial year 2025, the government had reduced the capital gains tax on real estate to 12.5 percent (without indexation), whereas earlier it was 20 percent (with indexation). The indexation benefit allows taxpayers to arrive at the value of the property after adjusting for inflation. In such a situation, individuals or HUFs who buy houses before 23 July 2024 can pay tax at the rate of 12.5 percent without indexation or 20 percent with indexation under the new scheme.
Limit increased for ITR-3
Apart from this, the limit for asset and liability reporting under Schedule AL for taxpayers filing ITR-3 has been increased from Rs 50 lakh to Rs 1 crore. This change in the rule has reduced the disclosure burden on taxpayers. Let us tell you that ITR Form-3 is filled by taxpayers who earn profits or income from profession or business.
