The Income Tax Department officially notified ITR Form 1 on Wednesday — paving the way for taxpayers to begin filing their returns. The simplified form is designed for individuals and entities who earned up to Rs 50 lakh during the recently concluded financial year. Several changes were made to the form ahead of the announcement, including new provisions for small investors.

Different tax returns are prescribed for filing by individual taxpayers depending on their source of income and residential status. Following the changes notified by the Central Board of Direct Taxes this week, individuals who have accrued long-term capital gains upto Rs 1.25 lakh within a financial year are also eligible to file the user-friendly application rather than the more complicated ITR-2.

What are the key changes notified this year?
Taxpayers can now report long term capital gains up to Rs 1.25 lakh (acquired from listed shares and equity mutual funds) through ITR-1. The revised form now includes an additional section for LTCG gains under Section 112A that are “not chargeable to income tax”. This simplifies the process greatly for small-scale investors with gains up to Rs 1.25 lakh on listed equity shares, equity mutual funds or business trusts. It is however pertinent to note that this form cannot be used for short-term capital gains, LTCG from immovable property, LTCG under Section 112A where taxes remain payable and cases with carried forward or brought forward losses.

The government has also made certain changes in the form with regard to deductions claimed under 80C, 80GG and other sections and has provided a drop down menu in the utility for tax filers to select from. Assessees will also have to furnish section-wise details with regard to TDS deductions in the ITR form.

When is the deadline?
The last date to file ITR for FY25 without late fees will be July 31.