The ITR-2 Form for AY 2025-26 has been updated by the Income Tax Department, introducing important changes that individuals must be aware of while filing their income tax returns for the Financial Year 2024-25.
🔁 Capital Gains Update in ITR-2 Form for AY 2025-26
A major update is the requirement to report capital gains separately for transactions done before and after July 23, 2024, as per the Finance Act, 2024. Taxpayers who have sold assets or shares must now break down these details by date to help apply new tax rules correctly. This change directly affects those using the ITR-2 Form for AY 2025-26.
Another key change involves capital loss on share buybacks. From October 1, 2024, you can claim such losses only if the related dividend income has been reported under “Income from Other Sources.” This is aimed at reducing misuse and increasing transparency.
The threshold for reporting assets and liabilities has been revised. Previously, individuals with total income above ₹50 lakh had to report them, but now the limit is raised to ₹1 crore, which will reduce the compliance burden for many.
The form also introduces a new field under Schedule-TDS. Taxpayers must now mention the specific TDS section code (such as 194I for rent or 194J for professional services), improving TDS tracking and reconciliation.
Deductions claimed under sections like 80C and 10(13A) will now need more detailed disclosures. If you are claiming benefits for LIC, PPF, ELSS, or HRA, make sure the information you provide is accurate.
It’s important to note that the ITR-4 form is still available for individuals and firms with presumptive income up to ₹50 lakh. However, if you have capital gains, income above ₹50 lakh, or claim multiple deductions, the ITR-2 Form for AY 2025-26 is the appropriate form to use.
These changes are designed to improve transparency, compliance, and data accuracy. Ensure that you have your documents ready and understand the new format before filing your returns.
