And if you want to switch to the old tax regime and make use of the provisions such as tax exemptions entitled under section 80C and 80D — key provisions missing in the new regime, then you need to first opt out of the default i.e., new regime.
Alternatively, if you want to make use of the lower tax slabs given in the new tax regime as a trade-off for the foregone tax exemptions, then you don’t need to go for this switch.
Here we give a lowdown on switching from the old tax regime to the new tax regime.
Which form do you require?
One has to file form 10-IEA which is an application for exercise of option under section 115 BAC(6), i.e., for opting out of the new tax regime.
For business cases, form 10-IEA has been notified which can be used by taxpayers to exercise their right to choose between the old regime. By filing this form, the taxpayers can inform the income tax department of their choice regarding the tax regime.
In non-business cases, options can be exercised with return of income on or before the due date specified under section 139(1).
Due date to apply
In case of business income, form 10-IEA should be filed on or before the due date specified under section 139(1) for furnishing the return of income.
The due date forindividual/HUF/AOP/BO is July 31 and for businesses subjected to audit, the due date for filing the return is October 31.
Notably, in case you want to opt out of the new tax regime, and you fail to file the form within the due date of filing ITR, you will not be eligible to opt for the old tax regime in your ITR for the relevant assessment year.
ALSO READ: Income Tax: As ITR forms enabled to file returns, check here which form you would require
How many times can you switch between tax regimes?
While an individual without income from a business or profession can switch regimes each year, an individual having income from a business and profession can not switch regimes more than once in their lifetime.
So, in the case of income from a business and profession, the option to switch to the old tax regime and withdraw the option in any subsequent assessment year is available only once in their lifetime.
A step-by-step guide:
1. Log in your account from an e-filing account. Post login, file income tax form 10IEA.
2. Select the relevant assessment year. Click, let’s get started.
3. Then you will be asked whether you have income under the head ‘business and profession.
4. Then the system shows the due date as applicable i.e. July 31, or October 31 as the case may be.
5. Once you select the due date, the system will ask for your confirmation and will tell you that if the form is validly filed, the same cannot be withdrawn.
6. You have to click ‘yes’ to continue.
Now, you will see three sections:
1. Basic information: This will ask you if you are opting out or re-entering the regime provided. then click on save.
2. Additional information: This will ask whether you have any units in the International Financial Services Centre. If yes, you will have to give additional information about these units.
3. Declaration and verification: Then you verify the form, and confirm the save.
Post submission you can check the status of filed forms. You can go to e-file> income tax forms> view filed forms.
Here, you will be able to see the status of form filing on the e-filing portal.
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Published: 07 May 2024, 04:44 PM IST