ITR Filing 2025: With the Income Tax Department notifying all the ITR forms with several changes to accommodate several tax-related announcements, including those about capital gains reporting and disclosure norms, it has now become easier for return filers to give information about income earned from selling shares or property.
So if you are among those who have earned some money by selling shares, mutual funds, or property last year and are now preparing to file the income tax return (ITR), then you might see that filing a return this time is a little easier than the last time. The government has made some changes in the ITR Form 1, which are especially beneficial for salaried people, small businessmen, and property sellers.
In the last year’s budget, Union Finance Minister Nirmala Sitharaman raised the exemption limit on long-term capital gains for listed equity and mutual funds to Rs 1.25 lakh under Section 112A. So, a big change now in this year’s tax return filing will be for those filing ITR form 1 despite having income from long-term capital gains. Previously, such taxpayers with income from long-term capital gains, even when no tax was payable due to the exemption limit, were asked to file more complex ITR-2 or ITR-3 forms, creating problems for small taxpayers.
Also read: ITR Filing 2025: Who all need to file their income tax return by July 31?
Now, small investors will not have to file complex forms
Now, if your profit is less than Rs 1.25 lakh or less in a year by selling mutual funds or shares, then you are not required to file a complex form like ITR-2 or ITR-3.
You can directly file ITR-1 (Sahaj) or ITR-4 (Sugam)
This change is a big relief for those who earn from salary or are small businessmen and also earn a little from investment.
New tax option for those selling their house or any other immovable property
If you bought a house or land before 23 July 2024 and are now selling it, then you have two options: You can pay 12.5% tax, but it will not get the indexation benefit. Alternatively, you can pay 20% tax in which the indexation benefit can be availed.
As regards ITR-2, the updated form will have a separate LTCG reporting provision for transactions done before and after July 23, 2024, accommodating revised norms for indexation and tax rates. Also, buyback proceeds after October 1 last year need to be shown under ‘Income from Other Sources’ and as well as ‘Nil’ consideration in the capital gains section.
Till now, people who had total assets of more than Rs 50 lakh, had to give details of everything they have – like house, car, loan – in ITR.
Now this limit has been increased to Rs 1 crore. That is, now only those people will have to give this detail whose property is more than ₹ 1 crore. This will reduce the burden on the middle class a bit.
Also read: ITR-1 Form Sahaj simplified for salaried individuals, pensioners: How to file tax return online – Step-by-step guide
Which ITR form for whom?
ITR-1 (Sahaj): Income from salary, interest and one house property, total annual income up to ₹50 lakh
ITR-4 (Sugam): Small traders, professionals, whose income comes under the presumptive tax regime
ITR-2: Those who do not have salary but have income from mutual funds or shares
ITR-3: Those who have income from business or profession
ITR-5, 6, 7: For firms, companies, trusts etc.
The last date for filing ITR for general taxpayers is July 31, 2025. Late fees may be charged if delayed.
Summing up…
ITR filing has now become easier for small investors and salaried people. Property sellers have two ways to pay tax – 12.5% tax with indexation benefits or 20% without indexation for properties purchased before July 23, 2024.