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ITR - 3

About Form ITR - 3

About Form ITR - 3

The Taxpayers in India are divided into various categories. They are required to file Income Tax returns depending upon their source of income. There are different ITR Forms for different category of taxpayers.

ITR-3 is a form that is relevant for individuals and HUFs having income from profits and gains of business or profession

Eligibility to file ITR - 3 Form

ITR-3 form is to be filled by an individual or HUFs who is making money by doing a profession or from a proprietary business. An individual taxpayer who can fill ITR-3, when his income comes from the below categories:

  • Income from a profession or business carried under a proprietorship firm for both audit and non-audit cases.
  • Income from Proprietary business
  • Income from one or more house properties
  • Income from short or long term capital gains
  • Reward earned by winning a lottery, horse racing and other activities falling under ‘income from other sources’
  • Income from assets in a country outside India.

For individuals or HUF functioning as a partner of the Partnership Firm, who is carrying out business or profession, then he cannot File form ITR-3 as he will be eligible to file Form ITR-2

Major Changes in ITR-3 for AY 2023-24

  • Must disclose any cash deposit excess of Rs 1 crore in the current account with any bank.
  • Must disclose any foreign travel expenses excess of Rs 2,00,000.
  • Disclosure of any expenses on electricity charges if more than 1 Lakh
  • For any earnings short or long-term capital gains by selling a building and/or land must be disclosed and, he/she must furnish some details of this sale. These details include a taxpayer’s PAN or Aadhaar information, residential address, and percentage share of ownership.
  • Introduction of a separate schedule 112A.
  • Company directors having unlisted equity investments, the type of Company must be disclosed.
  • An individual must provide details of tax deduction claims for expenditures, payments, or investments made between 1st April 2022 to 30th June 2023

Documents required to file ITR 3 Form

  • PAN Card
  • Aadhar Card
  • Bank account details and Bank Statements of Financial Year.
  • Form 16 if applicable
  • Investment details
  • Books of accounts
  • Rental Income Details if any, details of income from other sources.
  • Details of other disclosures necessary for ITR-3

Instructions to be followed while filing ITR - 3 Form

  • If in case the schedule is not applicable to the assessee, then the assessee has to just put “NA”.
  • In case if there is no figure to denote, mention Nil.
  • If there is a negative balance and you are writing it against a profit column then “-” sign needs to be added before the figure.
  • Always round off the figures to the nearest one rupee.
  • The total income or the payable loss should be rounded off to the nearest multiple of Rs. 10.
  • The section in part A needs to be filled after that 23 schedules are to be filled in part B.
  • Finally, you need to verify the document.

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