Filing ITR Just Got Simpler (and Smarter).

‍

The Income Tax Department has finally rolled out the new ITR-1 & ITR-4 forms for AY 2025–26 on 29th April 2025. Whether you're salaried, retired, a gig worker, or a small business owner — this one’s for you.

‍

1. Good News for Small Investors – LTCG Upto ₹1.25L Can Use ITR-1/4

Earlier, having any long-term capital gains meant you had to jump to a more complex ITR-2/3.
Not anymore!

Now, if your gains under Section 112A (i.e., from shares, mutual funds, REITs where STT is paid) are up to ₹1.25 lakh, you can still file the simpler ITR-1 or ITR-4.

But remember:

• No carry forward or set-off of past capital losses allowed here.
• Gains beyond ₹1.25L will still be taxed at 12.5% + cess/surcharge

.

2. New Section to Disclose Exempt Gains

A new section titled “Income on which no tax is payable” has been added.
Here, you must now report:

• Sale price of your investments
• Cost of buying them
• Gains made (if within ₹1.25L exemption)

This adds transparency but keeps it easy to track.

‍

3. Claiming Rent Deduction? Don’t Forget Form 10BA

If you don’t get HRA, but still pay rent, you can claim a Section 80GG deduction.
But… you now must e-file Form 10BA along with your return

.

Only those in the old tax regime are eligible.
So if you’re in the new tax regime under Section 115BAC, this deduction won’t apply.

‍

4. TDS Details Now Need Section Codes

In your TDS/TCS Schedule, you now need to mention the section number under which tax was deducted.

For example:

• Interest from banks → Section 194A

• Dividends → Section 194

Check these from your Form 16A or Form 26AS.

‍

5. Tax Regime Declaration: More Clarity, Less Confusion

If you’re filing ITR-4, you’ll now be asked:

• Did you file Form 10-IEA last year?
• Do you want to opt-out of the new tax regime this year?

‍

If you didn’t file the form earlier (say, used ITR-1 or 2), and now want to opt out of the new regime →

You must file Form 10-IEA this year before 31st July 2025.

‍

Final Thoughts from Team FOLO

This year’s ITR changes are like a fresh coat of paint — same structure, but smarter and more tailored.
It’s clear the aim is to make tax filing smoother, especially for those earning from salaries, pensions, or small ventures.

File your return before 31st July 2025 if you’re not under audit. Consult your tax advisor.

‍

‍