The Central Board of Direct Taxes (CBDT) has issued Notification No. 44/2025-Income Tax on May 6, 2025, to officially notify the New ITR-6 Form AY 2025-26. This updated form is applicable to companies other than those claiming exemption under Section 11 of the Income-tax Act, 1961. Effective from April 1, 2025, the new ITR-6 replaces the previous version and introduces several structural and disclosure-related changes in line with recent amendments to tax laws.
Major Compliance Updates in the New ITR-6 Form AY 2025-26:
One of the most significant changes in the new form is the revised format for reporting capital gains. Companies are now required to disclose capital gains separately for transactions executed before and after July 23, 2024. This change was introduced to comply with the amendments brought by the Finance Act, 2024, and is aimed at ensuring greater clarity and accuracy in capital gains computation and tax reporting.
Another key inclusion is related to the treatment of capital losses arising from share buybacks. Under the new rules, companies are now permitted to claim such losses, but only on the condition that the associated dividend income is reported under the head “Income from Other Sources.” This provision is applicable for income generated after October 1, 2024, and helps in aligning the tax implications of buyback transactions with income reporting obligations.
A noteworthy addition is the inclusion of Section 44BBC, which is specific to businesses operating in the cruise sector. With this, companies engaged in cruise operations now have a designated provision for reporting their income, offering more clarity and consistency in the way such businesses are assessed under the Income-tax Act.
The form has also introduced a compliance requirement for companies involved in the raw diamond trade. Under Rule 10TIA, such companies must report business profits that are at least 4% of gross receipts. This rule aims to ensure that high-value businesses like diamond trading maintain a minimum profit threshold in their disclosures and reduce the possibility of underreporting income.
In another useful update, the ITR-6 form has refined the method for capturing deductions under Section 24(b), which deals with interest on housing loans. This change is expected to help companies report their deductions more accurately and avoid delays in processing due to incorrect or incomplete entries related to housing loan interest.
Lastly, the form now mandates the disclosure of the correct TDS section code in the relevant schedules. This change is crucial for ensuring accurate matching of tax credits and avoiding errors or mismatches during tax return processing.
All of these changes are introduced as part of the Income-tax (Sixteenth Amendment) Rules, 2025. The government has made it clear that these updates will not be applied retrospectively in a way that negatively affects taxpayers. Companies are advised to start preparing early by reviewing financial records, updating tax reporting systems, and consulting with qualified tax professionals to ensure full compliance with the updated reporting format.
