ITR Filing- CBDT notifies new ITR Forms 1 & 4 for AY2024-25

ITR Filing: CBDT notifies new ITR Forms 1 & 4 for AY2024-25

Surprising taxpayers with an unexpected and welcome gesture, the Income Tax Department has played the role of an early Santa Claus this year by unveiling the Income Tax Return (ITR) Forms 1 and 4 for the Assessment Year 2024-25. These ITR Forms will be applicable for filing income tax returns with respect to income earned during the previous year 2023-24 (between 01-04-2023 to 31-03-2024).

“The I-T department usually notifies the ITR form before the start of the subsequent Assessment Year, i.e. in February or March. However, this unexpected early release not only marks a departure from the established timeline but also implies that taxpayers will have a more extended period to familiarize themselves with the changes, gather necessary documentation, and file their returns with greater precision,” said Naveen Wadhwa, Vice President Research, Taxmann.

No change in the applicability of ITR forms

The CBDT has not amended Rule 12 of the Income-Tax Rules, 1962, which outlines the criteria for the applicability of ITR forms to different classes of taxpayers andmethod of furnishing returns.

The form to be used by a taxpayer to file the Income-Tax return for the AY 2024-25 will be same as applicable for AY 2023-24.

Also Read: How to manage the corpus effectively after your PPF account matures

New tax regime is now the default tax regime; taxpayers must choose to opt-out to prefer old regime

The Finance Act 2023 has amended the provisions of section 115BAC to make it the default tax regime for the assessee being an Individual, HUF, AOP, BOI and AJP. If an assessee does not want to pay tax according to the new tax regime, he will have to explicitly opt out of it and choose to be taxed under the old tax regime.

Section 115BAC(6) allows the eligible assessee to opt out of the new tax scheme. To exercise this option, the assessee having income (other than income from a businessor profession) must indicate his choice of tax regime in the return of income to be furnished for the relevant assessment year under Section 139(1).

An assessee having income from a business or profession can also opt out of the new tax regime and switch to the old tax regime for a relevant year. However, he has to exercise this option in Form No. 10-IEA on or before the due date for filing the return of income under Section 139(1).

In simple words, an assessee filing ITR 1 is only required to indicate his choice of tax regime in the return of income. An assessee filing ITR 4 will be required to file Form10-IEA to opt out of the new tax regime.

The new ITR Forms 1 and 4 have been amended to incorporate this change.

New column added to claim deduction under section 80CCH

The Finance Act 2023 added a new Section 80CCH, which states that individuals enrolled in the Agnipath Scheme and subscribing to the Agniveer Corpus Fund on or after 01-11-2022 will be eligible for a tax deduction for the total amount depositedin the Agniveer Corpus Fund.

ITR forms 1 and 4 have been amended to include a column to furnish the amounteligible for deduction under section 80CCH.

‘Receipts in Cash’ column added to ITR-4 to claim enhanced turnover limit

The Finance Act, 2023 has enhanced the turnover threshold limit from Rs 2 crore to Rs 3 crore for opting for the presumptive taxation scheme under Section 44AD if the receipts in cash do not exceed 5% of the total turnover or gross receipts for the previous year. It is also provided that the meaning of cash would include the chequeor a bank draft, which is not an account payee. Similarly, Section 44ADA was amended to enhance the threshold limit of gross receipts from Rs 50 lakh to Rs 75 lakh, if the receipts in cash do not exceed 5% of the total gross receipts for the previous year.