Hi,
I have no income from business or profession, still my accountant filed ITR-3 for me for FY 2023-24 under new regime, can I change it to old for FY 2024-25?
@Quicko
Hi @Shiv_Katira,
The new regime has been made the default tax regime.
Now, in case you have income from business and profession in FY 2024-25, you can opt for the old regime. However, you can switch the regimes only once. This, means that later if you go for the new regime, you won’t be able to go back to the old one.
But, if your don’t have income from business or profession and are not filing ITR-3/ITR-4, there’s no such restriction and you can switch the regime every year.
Hope this helps!
I have salaried income and FnO Gains. Last year I have filed taxes under old regime. However, this year my employer opted for new regime during form 16 generation as it was beneficial for me. Now can I switch to Old regime during filing taxes?
If I file taxes this year in new regime. Can I file taxes next year onwards under OLD regime (I didn’t made ant tax saving investment, so new regime is beneficial for me this year)?
Hey @sameer_ranjan,
Yes, you can choose whichever regime is more beneficial to you at the time of filing ITR. Individuals filing ITR 1 or 2 can switch regimes every year.
However, ones with business/professional income filing ITR-3 or ITR-4 can only switch the regimes once.
Hope this helps!
Hi @Quicko ,
What does “business/professional income filing ITR-3 or ITR-4 can only switch the regimes once” mean? Can an individual filing ITR-3 switch to old regime once only for one year, or after switching s/he can continue filing in the old regime?
@Quicko Also, is it possible to switch ITR? eg. In FY 2023-24, I filed ITR-3, now in FY 2024-25, can I switch to ITR-2 and pay taxes as per the old scheme?
Hey @Shiv_Katira,
Yes, you can select the form based on your sources of income for the particular FY.
For individuals with business/professional income, switching the regime is only possible once. This means that if you opt for the old regime and go back to the new one, you cannot opt for the old regime again.
Hope this helps!
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@Quicko need more clarity on switching between old and new tax regime in case of business income. New tax regime is default regime with effect from Apr 1, 2023 and if one wants to opt out of default regime, he should file form 10IEA.
I believe choosing a regime with your employer will not have any say in switch. So you can opt for old/ new regime with your employer at the start of FY. What matters is choosing a regime at the time of tax filing for that FY.
I had in the past opted for old tax regime. Please confirm if I opt out of new tax regime this year, would it be considered switch? Or if I decide to go ahead with default regime i.e. new tax regime, it will be treated as switch as I was paying taxes as per old tax regime till last year.
Hi @prabhatbhardwaj,
Now, if you opt for the old regime, it will be considered a switch.
No, as the new regime is default this will not count as switching regimes.
Hope this helps!
Thank you for clarification
Wait, so if I’m filing ITR for the first time, with busines loss, so filing ITR 3 with old regime.
So I can never change regime? Since new regime is default and picking old would be considered a switch??
That sounds really dumb since I am not switching and just picking
Hey @tallerballer,
You can switch and opt for the old regime, but once you do so, you can’t go back to the old one.
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What if a person having major income source from Salary with some capital gains and FNO income under New tax regime from last 2 years (ITR 2) want to switch to old regime from this FY?
Would he be allowed to change tax regime every year since she is filing ITR 2 ? Or any switching logic like one time switch to old tax regime will result in old tax regime forever apply here?
Hi @Girish128,
Income from F&O trading is reported as business income and hence ITR-3 needs to be filed. For individuals with business/professional income, the option to switch the regimes is only available for one time.
This means that if you switch to the old regime, you can switch back to the new regime only once and after that you’ll have to continue with the new regime.