Income Tax Return Filing: Complete ITR Form 3 Checklist for AY 2025-26 [Read Notification]

With the Assessment Season ongoing, taxpayers are required to get a head start on filing their income tax returns. Income tax in India plays a crucial role in contributing to the country’s development by financing public infrastructure, welfare schemes, and government operations.

The Central Board of Direct Taxes (CBDT) has officially released the ITR-3 form for the Assessment Year (AY) 2025–26. Taxpayers must note that the due date for filing ITR-3 for non-audit cases is July 31, 2025. For cases where accounts are subject to audit under the Income Tax Act, the deadline is October 31, 2025.

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What is the ITR Form 3?

ITR Form 3 is an income tax return form meant for individuals and Hindu Undivided Families (HUFs) who have income from a proprietary business or profession. It accommodates a wide array of income heads including salary, house property, capital gains, other sources, and income from business or profession.

This form is significantly more detailed than return forms like ITR-1 or ITR-2 in comparison, as it is designed to capture comprehensive information relating to the taxpayer's business operations, profit and loss accounts, and other financial data.

Who is Supposed to File ITR Form 3?

Individuals or HUFs who earn income from a business or profession are required to file ITR-3. The list of applicable people includes professionals such as doctors, lawyers, architects, consultants, and freelancers, as well as sole proprietors and self-employed individuals as well.

Additionally, taxpayers who are partners in a firm but do not receive a salary from the firm are eligible to file this form. On the other hand, individuals whose income is limited to salary, one house property, other sources, or capital gains, and who do not engage in any business or profession, should opt for other applicable ITR forms such as ITR-1 or ITR-2. Moreover, those earning income from a partnership firm (where the firm files ITR-5) and receiving salary, bonus, interest, or commission must also use ITR-3.

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Documents Required for E-Filing ITR-3

To ensure a seamless e-filing experience, taxpayers must keep the following documents handy:

• PAN Card
• Aadhaar Card
• Form 16 (For Salaried Taxpayers)
• Bank Statements
• Interest Certificates
• Books Of Accounts Including Balance Sheet
• Profit & Loss Statements (In Case Of Business Income)
• Details Of All Assets And Liabilities
• Investment Proofs For Deductions Under Sections Like 80c, 80d

If the taxpayer has capital gains, documentation such as broker statements, sale and purchase deeds, and other relevant records should be maintained. GST returns and reconciliation details are also necessary for businesses registered under GST.

Major Changes in the ITR-3 Form for A.Y. 2025–26

The ITR-3 Form for AY 2025–26 comes with significant updates that taxpayers must take into account.

High-spend disclosures have been expanded, requiring taxpayers to report if they have spent more than ₹2 lakh abroad, ₹1 lakh on electricity, or ₹1 crore in deposits. The threshold for reporting assets and liabilities has been revised with only individuals whose income exceeds ₹1 crore required to report, removing the earlier ₹50 lakh limit.

A new section mandates the tagging of PAN or Aadhaar of the spouse or child if clubbing provisions under Section 64 are applicable.

Regarding capital gains, listed shares sold after July 23, 2024, shall be taxed at 12.5% instead of the earlier 20%. Additionally, securities need to be bifurcated based on their acquisition date - before and after July 23, 2024 to prevent erroneous clubbing.

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In terms of ESOP (Employee Stock Option Plan) reporting, taxpayers must declare details such as deferment, the year of sale, employer details, and the assessment year of taxability, which is especially crucial for startups.

In terms of alternative tax computations, AMT (Alternate Minimum Tax) and AMTC (Alternate Minimum Tax Credit) details are now to be provided in a more granular format, especially where IFSCs and brought forward credits are involved. For those earning over ₹5 lakh from agriculture, detailed location-wise disclosure is mandatory.

Furthermore, the return form is now linked with GST, requiring the outward supplies reported in ITR to match those declared in GST returns, thus eliminating the possibility of discrepancies through ITR-only declarations.

Another notable change is that taxpayers can no longer merely tick the “I declare” checkbox. They must specify and substantiate any claims or disclosures, especially those involving Advance Pricing Agreements (APA) or modifications.

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ITR-3 Filing Deadlines

For the Assessment Year 2025–26, the deadline for filing ITR-3 is July 31, 2025, for taxpayers not requiring an audit under the Income Tax Act. However, where audit requirements under Section 44AB are applicable, the due date extends to October 31, 2025.

Default Regime and How to Opt for the Old Regime

From A.Y. 2025–26, the new tax regime continues to be the default option. This regime offers concessional tax rates but removes several exemptions and deductions. Taxpayers who wish to revert to the old regime, which allows claims under various deductions and exemptions, must explicitly opt out. This is now done through the filing of Form 10-IEA.

The process to opt out of the default regime has been revised with it now involving dropdown selections and validation for multiple assessment years. Once chosen, the selected regime applies to subsequent years unless withdrawn under prescribed rules. Hence, taxpayers must carefully analyze which regime is more beneficial based on their income structure and deduction eligibility before making a decision.

Use this checklist to guide your filing process and stay on track—filing by July 31 (non-audit) or October 31 (audit) is crucial, as late returns attract penalties and interest. Adhering to these deadlines ensures you comply smoothly with CBDT’s AY 2025–26 requirements and avoid unnecessary charges.

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