The Central Board of Direct Taxes (CBDT) has officially released the Income Tax Return (ITR) forms – ITR-2 and ITR-3, catering to the financial year 2023-24 (assessment year 2024-25). In a recent press release, the department outlined changes and implications for individuals and entities, including Hindu Undivided Families (HUFs). The ITR-2 and ITR-3 forms facilitate the filing of Income Tax Returns for the period spanning April 1, 2023, to March 31, 2024, with the deadline set for July 31, 2024.
ITR-2: Tailored for Fixed Income Sources
ITR-2 is specifically designed for individuals and HUFs with fixed income sources, regardless of residency status. These sources encompass:
- Salary or pension.
- Income or loss from one or more house properties.
- Income or loss under ‘Capital Gain.’
- Income under the head ‘Other sources,’ including income chargeable at special rates.
Notably, ITR-2 is not applicable for individuals or HUFs whose total annual income includes business or professional income. Additionally, individuals earning income from interest, salary, bonus, commission, or remuneration are ineligible to file ITR-2 as per income tax regulations.
ITR-3: Geared Towards Business or Professional Income
ITR-3 is tailored for individuals or HUFs deriving income from business or profession. It is the suitable form for those with income elements such as interest, salary, bonus, commission, or remuneration from a partnership firm under the head ‘Profits and gains of business or profession.’ However, ITR-3 does not apply to individuals or HUFs with no business or professional income.
Key Changes in the Updated Forms
The revamped ITR forms introduce several new fields for disclosures, encompassing details such as Legal Entity Identifier (LEI) number, Acknowledgment Number of Audit Report, UDIN, and capital gains account specifics. Notably, individuals or HUFs subject to tax audits can now verify their ITR using the Electronic Verification Code (EVC) instead of the previous reliance on Digital Signature Certificates (DSCs). These changes aim to enhance the accuracy and transparency of the income tax filing process.
Keep watching our YouTube Channel ‘DNP INDIA’. Also, please subscribe and follow us on FACEBOOK, INSTAGRAM, and TWITTER
