ITR Filing: Reasons Behind the Delay of ITR-2 and ITR-3 Forms
Taxpayers in India can breathe a sigh of relief as the Income Tax Department has extended the deadline for filing Income Tax Returns (ITR) for the financial year 2024-25. Originally set for July 31, 2025, the new deadline is now September 15, 2025. This extension comes as many taxpayers, particularly those filing ITR-2 and ITR-3, have faced delays due to the unavailability of necessary filing utilities. The changes in the ITR forms have contributed to this situation, prompting the department to allow more time for compliance.
Delay in ITR-2 and ITR-3 Filing Utilities
The delay in the availability of ITR-2 and ITR-3 filing utilities has raised concerns among taxpayers. Experts attribute this setback to significant changes in the Income Tax Return forms, which have made them more complex. Sonu Iyer, a partner at EY India, explains that these forms cater to individuals with intricate financial situations, including income from multiple properties, capital gains, and foreign assets. The new requirements necessitate detailed reporting, which has complicated the development of the e-filing utilities.
The ITR-2 and ITR-3 forms require comprehensive updates to align with the latest reporting standards introduced by the Finance Act, 2024. These updates include separate reporting of capital gains earned before and after July 23, 2024, as well as detailed deductions and exemptions. The Income Tax Department has acknowledged the need for additional time to ensure that the utilities are ready for taxpayers, leading to the extension of the filing deadline.
Eligibility for ITR-2 and ITR-3
Understanding who needs to file ITR-2 and ITR-3 is crucial for taxpayers. ITR-2 is designed for individual and Hindu Undivided Family (HUF) taxpayers who earn income from various sources, including salaries, multiple residential properties, capital gains, and foreign income. It is also applicable for those with agricultural income exceeding INR 5,000, company directors, and individuals with non-resident or resident non-ordinary resident (RNOR) status.
On the other hand, ITR-3 is intended for self-employed individuals, independent contractors, and partners in firms. This form is necessary for those with income from proprietorships, capital gains, and ownership of non-listed equity shares. Taxpayers who do not qualify for simpler forms like ITR-1 or ITR-4 must use ITR-3. Both forms require careful attention to detail, especially with the recent changes in reporting requirements.
Official Announcement of Deadline Extension
The Central Board of Direct Taxes (CBDT) officially announced the extension of the ITR filing deadline on May 27, 2025. The decision was made in light of the extensive modifications to the ITR forms and the time needed for system readiness. The CBDT emphasized that these changes aim to streamline the compliance process and enhance transparency in reporting.
The board noted that the new ITRs for Assessment Year 2025-26 feature significant structural and content modifications. These alterations require additional time for system development and integration. Furthermore, the CBDT pointed out that Tax Deducted at Source (TDS) statements, which must be submitted by May 31, 2025, are expected to be available in early June. This timing further restricts the window for taxpayers to file their returns without the extension.
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