Source: PIB
Filing your Income Tax Return (ITR) is an important step to stay compliant with the law. It lets you report your income, pay any taxes due, and claim refunds if eligible. It’s also useful as proof of income for loans, visas, and other financial needs. For FY 2024–25 (AY 2025–26), the last date for most individuals, HUFs, and other non-audit taxpayers to file was September 15, 2025. Since this date has passed, you can still file a belated return, but doing so may involve a late fee or interest on unpaid taxes.
Note: Late Filing Fees
If you file your ITR after the due date, a late fee applies:
Interest: 1% per month on any unpaid tax is also charged.
₹5,000 for most cases.
₹1,000 if your total income is ₹5 lakh or less.
Old vs New Tax Regime (FY 2024–25 / AY 2025–26)
When filing your Income Tax Return (ITR), you must choose between the Old Tax Regime and the New Tax Regime. This choice affects your tax rates, deductions, and exemptions.
Old Tax Regime:
- Uses higher tax rates but allows a wide range of deductions and exemptions.
- Suitable for individuals who invest and save strategically to reduce taxable income.
New Tax Regime:
- Offers lower tax rates with minimal exemptions.
- Designed for taxpayers who prefer a simpler, straightforward system without detailed tax planning.
- Made the default option from FY 2023–24, but you can still choose the regime that works best for you.
Know the Difference Between Financial Year (FY) and Assessment Year (AY)
Financial Year (FY): This is the year in which you earn your income.
Example: If you earn income between 1 April 2024 and 31 March 2025, that period is called FY 2024–25.
Assessment Year (AY): This is the year after the Financial Year when you file your Income Tax Return (ITR) and the government checks your income.
Example: Income earned in FY 2024–25 will be reported and assessed in AY 2025–26.
Read in Detail: Difference Between Financial Year and Assessment Year
| Feature | Old Tax Regime | New Tax Regime |
|---|---|---|
| Tax Rates | Higher rates across income slabs | Lower rates across income slabs |
| Deductions & Exemptions | Wide range: standard deduction, investments, insurance, home loan interest, etc. | Very limited: standard deduction ₹75,000, employer NPS contribution, family pension |
| 80C Investments | Up to ₹1.5 lakh in PF, LIC, PPF, ELSS, etc. | Not allowed |
| Medical Insurance (80D) | Up to ₹25,000 (₹50,000 for senior citizens) | Not allowed |
| Rebate | Income up to ₹5 lakh → no tax | Income up to ₹7 lakh → no tax |
| Default Option | Optional; choose based on benefits | Default for FY 2023–24 onwards; can switch to Old Regime if needed |
Non-Audit Tax Filing Made Easy
A non-audit case means your accounts don’t need an audit under the Income Tax Act. This usually covers:
Small businesses and professionals following the presumptive taxation scheme (Sections 44AD, 44ADA, 44AE) with turnover below the audit limit.
Individuals and HUFs earning from salary, pension, house property, capital gains, or other sources.
Importance of Filing Income Tax Return (ITR)
Filing your Income Tax Return (ITR) is more than just a legal requirement—it helps strengthen your personal financial credibility and supports the nation’s economy.
- For Individuals:
- Builds creditworthiness, useful for loans, visas, and business contracts.
- Allows you to claim refunds for excess taxes paid.
- Enables the carry-forward of losses for future setoffs.
- For the Government:
- Provides data for policy planning, subsidy targeting, and widening the tax base.
- Offers insights into income patterns and economic activity, aiding better governance.
Timely and accurate filing ensures a transparent and accountable economy, promoting compliance and financial inclusion.
Categories of ITR
The Income Tax Department issues different ITR forms each year for various types of taxpayers. Choosing the right form is important, as filing in the wrong form can make your return defective.
For FY 2024–25 (AY 2025–26), the key forms for non-audit taxpayers (individuals and small entities) are:
ITR-1 (Sahaj) – For Salaried Individuals
A salaried individual earns income from an employer as salary, wages, allowances, perquisites, or pension under the head “Income from Salary.”
Who Can Use ITR-1:
- Resident Individuals (Not Ordinarily Resident)
- Total income up to ₹50 lakh
- Income from:
- Salary or Pension
- One House Property
- Other Sources (bank interest, family pension)
- Agricultural income up to ₹5,000
Who Cannot Use ITR-1:
- Total income over ₹50 lakh
- Income from more than one house property
- Income under Capital Gains (short-term or long-term u/s 112A exceeding ₹1.25 lakh)
- Directors in a company
- Held unlisted equity shares during the previous year
- Any asset or financial interest outside India
- Signing authority in any foreign account
- Income from any source outside India
- Income from business or profession
- Deferred tax on ESOPs (Employee Stock Options)
- Income on which tax was deducted u/s 194N
- Any brought forward loss or loss to be carried forward
ITR-2 – For Individuals/HUFs (No Business or Profession Income)
Who it’s for:
- Individuals earning income from salary, pension, house property, capital gains, or other sources, but not from business or profession.
- HUFs (Hindu Undivided Families): Families descended from a common ancestor, including wives and unmarried daughters, taxed as a separate entity.
Who Can File ITR-2:
- Individuals or HUFs not eligible for ITR-1 (Sahaj)
- Taxpayers with no income from “Profits and Gains of business or profession
- Taxpayers not receiving income like salary, bonus, commission, or remuneration from a partnership firm
- Cases where the income of another person (spouse, minor child, etc.) needs to be clubbed, as long as it falls under eligible categories
Who Cannot File ITR-2:
- Individuals or HUFs with income from “Profits and Gains of Business or Profession
- Income received from partnership firms in the form of interest, salary, bonus, commission, or remuneration
ITR-3 – For Individuals & HUFs With Business/Profession Income
Who Can File ITR-3:
- Individuals or Hindu Undivided Families (HUFs) with income from Profits and Gains of Business or Profession
- Individuals or HUFs with income from a partnership firm, chargeable under business/profession heads
Who Cannot File ITR-3:
- Taxpayers who are eligible to file ITR-1, ITR-2, or ITR-4
ITR-4 (Sugam) – For Presumptive Income
What is Presumptive Income?
Presumptive income allows certain taxpayers to declare income at a fixed rate based on turnover or receipts, without maintaining detailed accounts or undergoing audits. This scheme is mainly for small businesses, professionals, and transporters.
Who Can File ITR-4:
- Individuals, Hindu Undivided Families (HUFs), and Firms (other than LLPs) who are residents
- Income from business or profession calculated on a presumptive basis
- Can also include:
- Salary or pension
- Income from one house property
- Income from other sources (bank interest, family pension, dividend)
- Agricultural income up to ₹5,000
Who Cannot File ITR-4:
- Income exceeding ₹50 lakh in a year
- Directors in a company
- Owners of more than one house property
- Income from capital gains (including long-term gains above ₹1.25 lakh under Section 112A)
- Held unlisted company shares during the year
- Own assets outside India or have foreign income
- Have authority to operate a foreign bank account
- Deferred tax on ESOPs
- Any brought forward loss or loss to be carried forward under any head of income
How to File Your ITR (FY 2024–25 / AY 2025–26)
Step 1: Log in at incometax.gov.in using your PAN/Aadhaar and password.
Step 2: Navigate to e-File → Income Tax Return → File Income Tax Return.
Step 3: Select Assessment Year 2025–26.
Step 4: Choose the correct ITR form based on your income type.
Step 5: Review pre-filled details such as salary, TDS, and bank interest.
Step 6: Add any missing income or deductions and select your tax regime (Old or New).
Step 7: Submit your return.
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