Filing your Income Tax Return (ITR) can sometimes be confusing, especially with changes in tax laws and regulations. This blog post aims to address some of the most common issues taxpayers face when filing their returns for the Assessment Year (AY) 2024-25. We’ve compiled a list of frequently asked questions (FAQs) to help individual taxpayers and business owners navigate the process more smoothly.
Q.1: The taxpayer is unable to choose ITR 1 / 4 from the dropdown for AY 2024-25 as the option is greyed off while filing the return.
Answer:
If the taxpayer has a special rate of income and TDS is deducted for such income (e.g., Section 115BB), then ITR 1 and ITR 4 are not applicable for such taxpayers. The respective dropdowns are greyed out. In this case, the taxpayer is required to file ITR Form 2 or 3, as appropriate.
Q.2: Schedule VIA for claiming deductions is not enabled while filing the ITR for AY 2024-25?
Answer:
From AY 2024-25, the new tax regime has become the default tax regime, and VIA deductions cannot be claimed, except for deductions under Sections 80CCD(2), 80CCH, and 80JJA, as per Section 115BAC of the Income Tax Act, 1961. If the taxpayer wants to claim any deductions, they must choose the old tax regime by selecting “Yes” in ITR 1 / ITR 2 or “Yes, within due date” in ITR 3 / ITR 4 / ITR 5 in the field provided for the “opting out option” under Schedule ‘Personal Information’ or ‘Part-A General’ in the respective ITR. The ‘opting out option’ allows you to switch to the old tax regime if you wish to claim deductions, but it’s important to consider the implications of this decision on your tax liability.
Q.3: While filing the ITR, the taxpayer is getting a bank account validation error. How do we resolve the issue?
Answer:
The taxpayer should ensure that a valid bank account detail is added under the ‘My Bank Account’ tab in the ‘My Profile’ section on the income tax portal before filing the ITR. Updating the profile correctly before starting the new filing of the return is crucial. In case of any issues while validating the bank account, taxpayers can file ITR using offline utility. However, it’s important to note that a pre-validated bank account is required to issue a refund.
Q.4: If the taxpayer has earned particular income like winnings from the lottery or horse races, is the taxpayer eligible to file ITR 1 and ITR 4?
Answer:
In cases where TDS has been deducted on particular income, like winnings from the lottery or horse races, filing ITR 1 and ITR 4 is not allowed. It is recommended that the taxpayer check Form 26AS and AIS before filing the ITR.
Q.5: If Form 10IEA is filed for AY 2024-25, is it compulsory for the taxpayer to opt for the old tax regime?
Answer:
Yes, once Form 10IEA is filed for AY 2024-25, it cannot be reverted in the same AY, and the taxpayer must mandatorily opt for the old tax regime for AY 2024-25. The taxpayer can change the option in the next assessment year based on the income details and ITR applicability for that Assessment Year.
Q.6: In which case is filing of Form 10IEA for AY 2024-25 compulsory to opt for the old tax regime?
Answer:
In cases where the taxpayer wants to file ITR under the old tax regime for AY 2024-25 with business and professional income, i.e., either in ITR-3 or ITR-4, filing Form 10IEA is mandatory
Q.7: The taxpayer is unable to claim interest on borrowed capital for self-occupied property as it is greyed off.
Answer:
From AY 2024-25, the new tax regime has become the default tax regime, and claiming interest on borrowed capital for self-occupied property is not allowed under Section 115BAC of the Income Tax Act, 1961. If the taxpayer wants to claim, they must choose the old tax regime by selecting “Yes” in ITR 1 / ITR 2 or “Yes, within due date” in ITR 3 / ITR 4 / ITR 5 in the field provided for the “opting out option” in the ITR Form.
Q.8: While filing ITR for AY 2024-25, the taxpayer is unable to claim deductions other than Section 80CCD (2).
Answer:
From AY 2024-25, the new tax regime has become the default tax regime where claiming chapter VIA deductions is not allowed, except Section 80CCD (2), under Section 115BAC of the Income Tax Act. If the taxpayer wants to claim other VIA deductions, they must choose the old tax regime by selecting “Yes” in ITR 1 / ITR 2 or “Yes, within due date” in ITR 3 / ITR 4 in the field provided for the “opting out option” in the ITR Form.
Q.9: The taxpayer is getting an error: “The name of the taxpayer in ITR does not match the name as per the PAN database.”?
Answer:
The first name, middle name, and last name in ITR should be the same as the name registered under the ‘My Profile’ section after logging in to the portal. The taxpayer should update the profile and then download the latest prefill JSON for filing the return in offline mode or start new filing in online mode to resolve these issues.
Q.10: For AY 24-25, the taxpayer filed Form 10IEA by mistake and now wishes to revoke/withdraw the same. Can the taxpayer withdraw or rescind it?
Answer:
Once Form 10IEA is filed for AY 2024-25, it cannot be revoked/withdrawn in the same AY. The taxpayer must mandatorily opt for the old tax regime for AY 2024-25. However, the option to cancel will be available in subsequent years, and it can be changed only once in a lifetime for business and professional cases, i.e., in the case of ITR-3 or ITR-4.
Q.11: The taxpayer is unable to claim house rent allowance (HRA) under Section 10(13A) while filing the return for AY 2024-25.
Answer:
From AY 2024-25, the new tax regime has become the default tax regime where claiming HRA under Section 10(13A) is not allowed under Section 115BAC of the Income Tax Act. If the taxpayer wants to claim HRA, they must choose the old tax regime by selecting “Yes” in ITR 1 / ITR 2 or “Yes, within due date” in ITR 3 / ITR 4 in the field provided for the “opting out option” in the ITR Form.
Q.12: Is there any form required to file to claim the deduction under Sections 80DD and 80U?
Answer:
When claiming deductions under Sections 80DD and 80U, it is recommended that the taxpayer obtain a certificate from the relevant medical authority for the disabilities. This supports the deduction claimed under these sections. Taxpayers should file Form 101A as applicable per Rule 11A and furnish details of Form 10-IA (acknowledgment number and date) in Schedule 80DD/80U of the return.
Q.13: Does the taxpayer need to mandatorily verify the return?
Answer:
Yes, verification of the ITR after submission is mandatory. The taxpayer should ensure the return is verified within 30 days post successful submission, either through EVC mode or DSC. Taxpayers can also download the ITR-V receipt copy from the “View Filed Return” section after logging in to the portal and sending it to CPC through speed post within 30 days of filing for verification. Complete verification online is recommended to avoid postal issues.
Q.14: The taxpayer is unable to choose “Yes/No” for “Whether you were a director in a company at any time during the previous year” while filing the return in ITR 2/ ITR 3.
Answer:
This question is applicable only to individuals. Please check the status of the assessee. If the status is selected as ‘Individual,’ the option “Whether you are a ‘Director’ of a company at any time during the previous year” will be enabled. Enter the details and proceed to file the return.
Q.15: The taxpayer is getting an error: “Gross receipts/ Turnover is provided in Schedule BP, but financial particulars such as sundry creditors/Inventories, sundry debtors, cash in hand is not filled” in ITR 4?
Answer:
It is mandatory to fill fields such as ‘Sundry Creditors, Inventories, Sundry Debtors, Cash in Hand’ under “Financial particulars” in Schedule BP in ITR 4. If not filled, it will throw an error.
Q.16: The taxpayer filed Form 10-IEA and submitted the ITR with correct Form 10-IEA details, but it still needs to be corrected when entering valid Form 10-IEA details.
Answer:
The taxpayer should check and validate the Form 10IEA details under “View Filed Forms” after submission of Form 10IEA and then retry filing the ITR after entering the correct form details. Ensure that you do not submit Form 10-IEA multiple times on the portal.
Q.17: The taxpayer corrected validation errors encountered during ITR submission, but mistakes still show after correction.
Answer:
It is recommended that the ITR be resubmitted in a fresh session after errors have been corrected to avoid such issues.
Q.18: The taxpayer entered the amount of deduction under Section 80CCD (2) in Schedule VIA, but the eligible amount of deduction is computed as 0.
Answer:
The taxpayer should check if salary income is provided after selecting the ‘Basic Salary’ dropdown under Schedule Salary to compute the eligible deduction amount claimed under Section 80CCD (2) of the Income Tax Act, 1961.
Q.19: Is it mandatory to verify the return through DSC only for 44AB audit return cases?
Answer:
From 1st April 2024, as per the amendment in Rule 12 of Income Tax Rules, 1962, if an Individual or HUF is filing the return, taxpayers can verify the return through EVC mode or DSC mode even for 44AB audit applicable cases.
Q.20: What is the difference in the new tax regime provisions under Sections 115BAD, 115BAE, and 115BAC of the Income Tax Act, 1961, applicable for filing ITR-5 returns for AY 2024-25?
Answer:
- Section 115BAE: Applicable from AY 2024-25 for new co-operative societies resident in India, incorporated on or after 1st April 2023, engaged in the business of manufacturing. Taxpayers are required to pay tax @15% on manufacturing business income and @22% on the remaining income. Form 10IFA is needed to avail of this option.
- Section 115BAD: Applicable to all other resident co-operative societies registered on or after 1st April 2021, eligible to opt and pay a tax rate @22% on their total income. Form 10IF is required to avail of this option.
- Section 115BAC: Applicable to all AOPs (other than co-operative societies), BOIs, or AJPs filing returns of income in ITR-5 from AY 2024-25. Taxpayers can compute tax as per the revised tax slab applicable to the new tax regime and pay the tax accordingly. Form 10IEA is required within the due date to avail of this in case of business income.
Q.21: Is there any requirement to file any form for claiming the new tax regime under Sections 115BAD or 115BAE?
Answer:
Taxpayers need to file Form 10IF for claiming the new tax regime under Section 115BAD and Form 10IFA for claiming the new tax regime under Section 115BAE.
Q.22: Is the taxpayer required to file Form 10IF or 10IFA every year to claim the new Tax Regime in ITR-5 return for Sections 115BAD or 115BAE?
Answer:
No. Taxpayers are required to file Form 10IF or 10IFA only once within the due date as per Section 139(1) in the year they wish to opt for the new tax regime for the first time.
Conclusion
Filing ITR can be a complex process, but understanding these common issues and how to resolve them can make it easier. Whether you are an individual taxpayer or a business owner, staying informed about the latest tax regulations and procedures is crucial. If you have any more questions or need assistance with your ITR, don’t hesitate to reach out to our team of experts at Efiletax.