ITR-3 Form Notified by CBDT: What It Means for Taxpayers and Who Should Use It

The Central Board of Direct Taxes (CBDT) has officially notified the Income Tax Return Form ITR-3 for the Assessment Year 2025–26. This revised form includes key updates aimed at simplifying tax reporting, especially for individuals and Hindu Undivided Families (HUFs) earning income from business or profession.

Who Should Use ITR-3?

The ITR-3 form is meant for:

• Individuals and HUFs

• Earning income from proprietary business or profession

• Also includes those with income from Futures & Options (F&O) or speculative trading

The form will be used to report income earned during Financial Year 2024–25 (April 1, 2024, to March 31, 2025).

Key Changes Introduced in ITR-3

According to an official post by the Income Tax Department on X (formerly Twitter), several enhancements have been made to streamline tax filing:

1. Capital Gains Reporting Enhanced

• A new schedule allows capital gains to be split based on whether they occurred before or after July 23, 2024—important for accurate tax treatment.

• It now includes reporting of capital gains or losses from share buybacks.

• Dividend income, effective from October 1, 2024, must be shown as income from other sources as per the amended rules.

2. Higher Asset Reporting Threshold

• The threshold for mandatory asset and liability disclosure has been raised. Now, reporting is required only if total income exceeds ₹1 crore.

3. New Business Category Added

• The form includes a reference to Section 44BBC, which deals with businesses operating cruise services.

4. Advanced Deduction Disclosure

• A separate column is added for detailed reporting under deductions like Section 80C, Section 10(13A) (house rent allowance), and others.

5. Improved TDS Reporting

• The TDS schedule now has a dedicated column to mention the TDS section code, enhancing clarity.

ITR Filing Deadlines for FY 2024–25

Taxpayers must select the applicable ITR filing deadline based on their audit and transaction status:

• Without audit requirement: Last date is July 31, 2025

• With audit requirement: Deadline is October 31, 2025

• With international transactions: Deadline extends to November 30, 2025

• Belated ITR (in case of missed deadline): Can be filed until December 31, 2025

If a taxpayer chooses to opt out of the new tax regime, Form 10IEA must be submitted alongside the return.

Final Thoughts

With the latest notification, the ITR-3 form is now more robust and transparent, especially for taxpayers involved in business activities or capital markets. The updates aim to make tax compliance smoother while improving reporting accuracy for professionals, traders, and high-income individuals.

Note: Always consult a tax advisor or chartered accountant to ensure accurate ITR filing based on your specific financial situation.