Income Tax Return 1 (ITR-1) is the most commonly used ITR form by Individuals in income tax return filing. The income tax department has made certain changes in this form as per Budget 2023.
In this article, let’s understand these changes applicable for the FY 2023-24 (AY 2024-25).
Generally, the income tax department notifies income tax return (ITR) forms either at the closing of the respective financial year or at the beginning of the next financial year.
For instance, the current financial year which is financial year 23-24, will close on 31 March 2024 and the due date for filing of ITR for FY 23-24 is 31 July 2024. Accordingly, the Department will release ITR forms either in March 2024 or April 2024.
But this time for the financial year 2023-24, the income tax department has modified these ITR forms (as per the budget 2023) and notified within December’23 itself. This is a very good move from the department and it will help the taxpayers to understand the changes made in ITR and ITR Form completely before going for ITR filing.
Hopefully, the same changes will be incorporated into the income tax portal and e-filing will be enabled very soon as the next financial year commences. Do remember not to file your ITR as soon as the e-filing is enabled on the income tax portal because if you file it in April 2024, AIS may not be updated with your complete tax information which may turn your ITR defective. So please wait until mid-June to make sure all your information is reflected in AIS and then proceed with e-filing.
Changes in ITR for FY 2023-24
Now let’s discuss the changes made in ITR 1 for the financial year 2023-24 (AY 2024-25).
The first change is related to the Tax scheme to be opted by the taxpayers. Until last year, the Old scheme was the default scheme and if anyone wants to go with the New scheme, they need to specifically opt-in.
But from FY 2023-24, New scheme becomes the default option. If anyone wants to opt for the Old scheme then they need to opt out of the New scheme. Accordingly, the new ITR form is modified to satisfy this requirement.
So when you proceed with e-filing for the FY 23-24, the system automatically pre-fills ‘NO’ and if you want to opt for the old scheme, choose YES to opt-out from the new scheme.
Also, remember if an individual has a business or professional income and wants to opt out of the New scheme they need to file Form-10 IEA before filing their ITR.
The second change is for contribution to the Agniveer Corpus fund. Budget 2023 has provided a new deduction for contribution to the Agniveer Corpus fund. Accordingly, a new ITR form was suitably modified to incorporate this change.
These are the only changes in the ITR1 form and the rest of the form is the same as the last financial year i.e. FY 2022-23.
Hope you enjoyed reading the article. Thank you for your time.
Author is a Qualified CMA with an experience of more than 8 years in the industry. He is also an All India Rank holder in both Inter (AIR-26) & Final (AIR-46) examinations of ICAI. He loves to writes articles on Income Tax & GST.