The Income Tax Department has made necessary updates to the ITR-3 form, which will be used to file returns for the financial year 2024-25. This form is meant for individual taxpayers and Hindu Undivided Families (HUFs) who earn income from business or professional activities.
The department issued a notification about this on 30 April 2025. These changes simplify the return filing process and reduce the burden of extra disclosures for many taxpayers.
Schedule AL Limit Increased to Rs. 1 Crore for Asset Declaration
One of the most significant changes in the ITR-3 form is under Schedule AL (Assets and Liabilities). Earlier, taxpayers had to report their assets and liabilities only if the total value exceeded Rs. 50 lakh. Now, this limit has been increased to Rs. 1 crore.
This move will help taxpayers who had to provide details earlier, even for smaller asset values. With the increased limit, they can avoid extra paperwork if their declared amount is below Rs. 1 crore.
TDS Rule Update for E-commerce Operators with High Turnover
A new update applies to large e-commerce businesses. If their turnover crosses Rs. 5 crore, they must now deduct 1% TDS under Section 194Q. This rule is meant to keep track of high-value transactions done through online platforms and ensure proper tax compliance.
Taxpayers Must Report Foreign Assets in Schedule FA
Another change has been made in Schedule FA, where taxpayers must report their foreign assets and income. This step is to bring more clarity in disclosing income earned outside India. Those who hold any asset or have earned money abroad must provide all related information in this section.
Option to Choose Old Tax Regime with Form 10-EEA
Taxpayers now have the option to continue with the old tax regime if they wish. For this, they need to fill out Form 10-EEA while filing ITR-3. This flexibility will help taxpayers decide which tax structure suits them better — old or new — based on their deductions and exemptions.
New Schedule CG and STCG Section Added for Capital Gains Reporting
To improve the process of declaring profits from asset sales, the IT department has introduced Schedule CG. This section is now mandatory for reporting all capital gains. A separate column is also available for Short-Term Capital Gains (STCG) under Section 50, especially for depreciable assets.
These additions aim to make capital gains reporting more structured and transparent for businesses and professionals.
More Changes in Line with ITR-1 and ITR-2 Notifications
On 29 April 2025, the department released updated ITR-1 and ITR-2 forms as well. These changes aim to make income tax return filing simple, accurate, and time-saving.
Sources: ABP Live, Income Tax Department Notification
