Filing income tax returns (ITR) for FY2024-25 may feel more complicated this year due to key changes introduced in Budget 2024. With modifications in income tax slabs under the new regime and revised capital gains tax structures, taxpayers must stay informed to avoid errors and delays.
These updates apply to the financial year 2024-25 and should be carefully reviewed before proceeding with your ITR filing.
What Changed in Budget 2024?
The Union Budget 2024 introduced a series of income tax updates aimed at simplifying the tax system. However, these changes also demand a closer look when preparing to file returns.
Here are the top five changes every taxpayer should keep in mind:
1. New Income Tax Slabs Under the Simplified Regime
The new tax regime has been revamped to make it more attractive. Tax slabs have been adjusted, potentially changing your tax liability depending on your income bracket.
It’s important to compare the old and new regimes and choose the one that works best for your situation.
2. Rationalisation of Capital Gains Tax
Capital gains taxation has also undergone a makeover. The government has streamlined the structure, impacting gains from assets like equity, real estate, and mutual funds.
Investors and salaried individuals who’ve earned capital gains during FY2024-25 should factor in the updated holding period rules and tax rates.
3. Impact on Exemptions and Deductions
Under the new regime, many traditional exemptions and deductions (like HRA, LTA, 80C) are not available. This could alter your net taxable income significantly if you’re not opting for the old regime.
Always review your available deductions and compare both tax regimes before filing.
4. New Reporting Requirements
With changes in rules, taxpayers might see more detailed reporting sections in the ITR forms, especially for capital gains. Accurate disclosure is key to avoiding notices from the department.
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ITR Form Changes
The structure of ITR forms may reflect these policy shifts, so expect new fields or sections relevant to capital gains and regime selection.
Filing with outdated assumptions could result in misreporting or even penalties.
With multiple updates in income tax slabs and capital gains tax rules, ITR filing for FY2024-25 demands extra attention. Taxpayers should be fully aware of the Budget 2024 changes, understand the new vs old regime, and ensure all calculations are made with the latest guidelines in mind.
Taking time to review and adapt to the new tax rules can help avoid last-minute stress and ensure a smoother filing process.
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