ITR FILING FOR FY25: FROM LTCG TO BUYBACK DIVIDEND TAX, YOUR COMPLETE GUIDE

New thresholds for capital gains, buybacks, new tax rules—all for greater clarity and compliance

- MAYANK MOHANKA

The Central Board of Direct Taxes (CBDT) has released revised ITR forms 1-5 for AY 2025-26 to reflect Budget 2024 changes—raising capital gains thresholds and presumptive tax limits. These updates aim to give taxpayers more clarity but also introduce finer compliance requirements.

ITR 1 (Sahaj) remains for resident individuals and Hindu Undivided Families with annual income up to ₹50 lakh from salary, pension, interest, dividends and single house rent.

LTCG relief: Budget hiked the tax exempt limit for long-term capital gains on securities from ₹1 lakh to ₹1.25 lakh. The updated ITR 1 now lets those gains be reported on Sahaj. Previously, even exempt gains forced filers into the more detailed ITR 2.

ITR 4 (Sugam) covers resident individuals and HUFs under the presumptive scheme. Its business turnover cap rose to ₹3 crore from ₹2 crore and professional receipts cap from ₹50 lakh to ₹75 lakh. Sugam also permits reporting LTCG up to ₹1.25 lakh.

ITR 2 is for individuals and HUFs with income above ₹50 lakh or any capital gain. ITR 3 caters to those with business or professional income. ITR 5 is for limited liability partnerships and business trusts. Forms 2, 3 and 5 include revised LTCG limit, updated turnover and receipts thresholds to align with the new tax rules.