ITR-3 e-filing enabled with updated capital gains, tax regime declarations

Hyderabad: The Income Tax Department has opened online filing for Form ITR-3, adding new compliance requirements linked to capital gains and tax regime declarations.

The form applies to individuals and Hindu Undivided Families with income from business, profession, share trading including futures and options or unlisted equity investments. It also covers income from salary, house property, partnership earnings, or other sources where ITR-1, ITR-2, or ITR-4 are not applicable.

Assessees must now confirm if Form 10-IEA was filed for the previous assessment year and specify whether they’re continuing with or opting out of the new tax regime.

Big changes are coming to capital gains taxes, following revisions laid out in the latest budget:

Long-term capital gains on both financial and non-financial assets will now be taxed at 12.5%, up from the previous 10%. Meanwhile, short-term gains on equities are seeing a sharper hike jumping from 15% to 20%.

The adjustments mark a significant shift in how investment profits will be taxed going forward.

All listed financial assets held beyond one year now qualify as long-term.

Schedule CG has been split to separate gains made before and after July 23, 2024. To claim indexation, taxpayers must submit acquisition and improvement costs for property sold prior to that date.

A new section in Schedule CG captures losses from share buybacks under Section 68 of the Companies Act, 2013.

Disclosure of assets and liabilities is now mandatory for taxpayers with total income exceeding ₹1 crore revised from ₹50 lakh unless these are already reported in the balance sheet.