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| IMAGE SOURCE BY TIMES OF INDIA |
The Income Tax Department has brought good news for taxpayers eligible to claim Section 87A refunds for FY 2023-24. An update on the e-filing portal, announced on December 31, 2024, stated that necessary changes will soon be made to the ITR-2 and ITR-3 forms to allow eligible taxpayers to file revised or late returns and claim their refunds.
Key Highlights:
Section 87A Refunds Now Accessible
- Taxpayers eligible for Section 87A can claim refunds up to ₹12,500 under the old tax regime and ₹25,000 under the new tax regime.
- Changes in the back-end software for ITR forms 2 and 3 will enable taxpayers to file revised or delayed returns to claim this benefit.
Updates to ITR Forms 2 and 3
- Updates to the e-filing utility will address issues where taxpayers with specific taxable income, such as short-term capital gains (STCG), were unable to claim the 87A refund.
- Chartered Accountants previously noted cases of taxpayers receiving notices for claiming refunds incorrectly when filing after July 5, 2024.
Extended Deadlines
- The Central Board of Direct Taxes (CBDT) extended the deadline for filing belated or revised ITRs for resident individual taxpayers to January 15, 2025 (from the original deadline of December 31, 2024).
- This extension follows an interim judgment from the Bombay High Court, which directed the tax department to provide relief until a final ruling on the denial of 87A refunds is delivered on January 9, 2025.
Chartered Accountant Guidance
- CA Ashish Niraj of A S N & Company stated, “Eligible taxpayers can now file a revised or delayed return through the updated utility or online e-filing portal. The software for ITR-2 and ITR-3 forms will soon be updated to facilitate these changes.”
Who Benefits from This Update?
- The relief is extended only to resident individuals, as clarified by the CBDT circular. Non-resident taxpayers are not eligible for this extension.
What Should Taxpayers Do Next?
- Monitor the e-filing portal for updates to ITR-2 and ITR-3 forms.
- File revised or delayed returns by January 15, 2025, to claim the Section 87A refund if eligible.
This update ensures that taxpayers who faced technical or procedural challenges in claiming their rightful refunds under Section 87A can now receive relief, demonstrating a responsive approach by the Income Tax Department.
NEWS SOURCE BY-THE ECONOMIC TIMES