ITR filing season begins: Start collecting key documents even as Forms-16, utilities are awaited

The income tax return (ITR) filing season for the financial year 2024-25, applicable to the assessment year 2025-26, is now open. The Income Tax Department has released updated ITR forms reflecting changes from Budget 2024, including revised provisions for capital gains taxation. The new ITR-1 (Sahaj) form can now be used by taxpayers with capital gains under ₹1.25 lakh, assuming no losses to carry forward. Choosing the correct ITR form is crucial as using an incorrect form may render your tax return defective, potentially causing delays in the filing process.

Taxpayers are advised to organise their documents ahead of the July 31 deadline to ensure a smooth filing experience. Essential documents include the Permanent Account Number (PAN) and Aadhaar card, which must be linked, as well as bank account statements, TDS certificates from banks, and the Form-26AS or Annual Information Statement (AIS). Employers should provide Form-16 for salaried individuals, which is critical for verifying tax deductions and salary details.

For those claiming House Rent Allowance (HRA), rent receipts and agreements must be kept handy. Additionally, disclosures of foreign assets and income are mandatory for certain filers, requiring foreign bank statements, investment transaction records, and Form 67 to claim foreign tax credits. If the total income exceeds Rs 50 lakh, details of assets and liabilities must be disclosed, particularly for those filing ITR-2. Previous years’ ITR copies are also necessary for reference.

Tax-saving investment proofs should be collected to support deductions claimed under Sections 80C, 80D, 80E, 24B, and 80G. These documents, including ELSS investment proofs, NPS contribution receipts, health insurance premium documents, and donation receipts, though not submitted with the ITR, need to be preserved for potential verification. The budget for 2025 has revised certain rebates, but for the current filing year, the older regime's deductions still apply.

Income from non-salary sources must be accurately reported. This includes capital gains statements from mutual funds, brokers, or intermediaries, and records of cryptocurrency investments, known as Virtual Digital Assets (VDAs), which require precise reporting in the VDA schedule. Bank TDS certificates should also be maintained to ensure all interest incomes are correctly reported. Early preparation and documentation can mitigate discrepancies between Form-16 and Form-26AS/AIS, ensuring compliance and reducing last-minute filing stress.

Although the online filing utilities are not yet live, taxpayers are encouraged to prepare in advance. This early organisation ensures that when the utilities become available, the process is seamless, and any potential issues with discrepancies are minimised. This proactive approach is essential in avoiding the rush and non-compliance penalties as the deadline approaches.