There are different categories of taxpayers in India, and each requires various forms to file ITR (Income Tax Returns). Form ITR 3 is the most difficult ITR form for taxpayers, especially non-professionals. In this write-up, we will discuss Form ITR 3.
What is Form ITR 3?
Form ITR 3 applies to the individuals and HUF (Hindu Undivided Families) who earn profit from business/profession. If the individual or HUF has an income as a partner in a partnership firm, which is carrying out business, then the person will not be required to file ITR 3; in this scenario, he must file ITR 2 Form.
Eligibility for Filing Form ITR 3
An ITR 3 Form applies to individuals and HUF whose total income for a provided assessment year includes the following:
- Income from the business or profession is carried under a proprietorship firm, wherein the taxpayer is the proprietor.
- Rewards are earned from winning a lottery, horseracing, or income from other sources of activities.
- Generate income from short or long-term capital gains.
- Earn income from one or several house properties.
- Income assets from the way of assets in a country outside India.
Structure of a Form ITR 3
ITR 3 is briefly divided into the following sections:
- Part A
- Part B
Let’s elaborate the each of these sections one by one:
- Part A includes-
|Part A- GEN||Nature of Business and General information|
|Part A- BS||Balance Sheet of the Proprietary Profession or Business as of 31st March 2021.|
|Part A- Manufacturing Account||Manufacturing Account for the financial year 2021-2021.|
|Part A- Trading Account||Trading Account for the financial year 2020-2021.|
|Part A- Profit & Loss||Profit and Loss for the Financial Year 2020-2021.|
|Part A- Other Details||It is optional in a case not liable for audit under Section 44AB.|
|Part A- QD||Quantitative information (it is optional in a case not liable for audit under Section 44AB).|
- Schedules include-
|Schedule- S||Computation of income under head Salaries.|
|Schedule- HP||Computation of income in the head Income from the Property of House.|
|Schedule- BP||Computation of income from profession or business.|
|Schedule- DOA||Computation of depreciation in another asset under the Income-tax Act.|
|Schedule- DPM||Computation of depreciation in plant and machinery under the Income-tax Act.|
|Schedule- DEP||Summary of depreciation on all the assets in the Income-tax Act.|
|Schedule- DCG||Computation of deemed capital gain on the sale of depreciable.|
|Schedule- CG||Computation of income under the head of Capital gains.|
|Schedule- ESR||expenditure on scientific research Deduction under section 35.|
|Schedule- 112A||Information on Capital gains where section 112A is applicable.|
|Schedule- OS||Computation of income in the head Income from other sources.|
|Schedule 115AD(1)(B)(iii)Proviso||For Non-Resident’s information on Capital gains where section 112A is applicable.|
|Schedule- CYLA-BFLA||Statement of income after set off current year’s losses and statement of income after set off unabsorbed loss brought forward from earlier years.|
|Schedule- CYLA||Statement of income after set-off of current year’s losses.|
|Schedule- BFLA||Statement of income after set-off of unabsorbed loss brought forward from earlier years.|
|Schedule- UD||Statement of unabsorbed depreciation.|
|Schedule- CFL||Statement of loss to be carried forward to future years.|
|Schedule- ICDS||Effect of income computation disclosure standard on profit.|
|Schedule- 80G||Statement of donations entitled for Deduction in section 80G.|
|Schedule- 10AA||Computation of Deduction under Section 10AA.|
|Schedule- RA||Includes information on donations to institutions entitled to deduction under Section 35(2AA), 35(1) (iia), or 35(1)(iii).|
|Schedule- 80IA||Computation of deduction under section 80IA.|
|Schedule- 80IB||Computation of deduction under section 80IB.|
|Schedule VI-A||Statement of deductions (from total income) in Chapter VIA.|
|Schedule- 80C/ 80-IE||Computation of Deduction under section 80IC/ 80-IE.|
|Schedule AMT||Computation of Alternate Minimum Tax Payable in Section 115JC.|
|Schedule AMTC||Analysis of tax credit under section 115JD|
|Schedule SI||Statement of income that is chargeable to tax at special rates.|
|Schedule SIP||Statement of income arising to spouse/ son’s wife/ minor child or any other person or association of person to be included in the assessee’s income in Schedules-HP, BP, CG, and OS.|
|Schedule IF||Details regarding partnership firms in which the assessee is a partner.|
|Schedule- PTI||Pass-through income information from business trust or investment fund as per sections 115UA and 115UB.|
|Schedule- EI||Statement of income not included with total income (exempt income).|
|Schedule- TPSA||Secondary adjustment to transfer price according to section 92CE(2A)|
|Schedule- TR||Statement of tax relief claimed in section 90 or section 90A or section 91.|
|Schedule- 5A||The Portuguese Civil Code governs details regarding the apportionment of income between spouses.|
|Schedule- FA||Statement of Foreign Assets & income from any source outside India.|
|Schedule- FSI||Information on income from outside India and tax relief.|
|Schedule- AL||Asset & Liability at the end of the year (applicable where the total income exceeds Rs.50 Lakhs)|
|Schedule- GST||Details regarding turnover/ gross receipt reported for GST.|
|Schedule- DI||Schedule of tax-saving investments, deposits, or payments to claim Deduction or exemption in the extended period from 1st April 2021 until 30th June 2021.|
- Part B
- Part B- TI: It includes the computation of a taxpayer’s total income.
- Part B- TTI: This Section computes the tax liabilities on one’s total income.
- Verification: Lastly, the Form ITR 3 structure guarantees to authenticate the details furnished above.
How to file Form ITR 3?
Form ITR 3 can be filed either online or offline:
- Online: The income tax return can be done electronically using the Digital Signature Certificate. This data can be transmitted after the submitting verification of the return.
- The Form ITR 3 online filing process starts with visiting the official e-filing web portal of the Income Tax Authority.
- You need to register an account with the portal if you are new.
- This portal auto-generates your PAN information. Then choose ‘Assessment Year’ for which you are filing the ITR 3 Form.
- Then go to the Revised Return section, if you wish to file a revised return against a previously filed original return’.
- Submit the online form and click on ‘Continue’.
- At this point, you are required to provide income details, exemptions, deductions, and investments.
- Then, add the details of tax payments through TDS, TCS, and/or advance tax.
- Remember to fill all data accurately and carefully. Additionally, periodically click on ‘save the Draft’ to avoid losing data.
- Select the preferred verification option from the following:
- Instant e-verification
- E-verification later but within 120 days from filing Form ITR 3.
- Verification through a duly signed ITR V sent to Centralised Processing Centre (CPC) via post and within 120 days of filing return.
- Select Preview and Submit the Form.
Electronic returns can be filed when:
- The assessee is an Indian resident, or in case the signing department is located out of India.
- Assess those claiming relief under sections 90, 90A, and 91 for whom the schedule FSI & Schedule TR must file the returns electronically.
- The assesses with more than Rs.5 Lakh total income must be outside India.
New Update in Form ITR 3
- THE ITR 3 e-filing offline utility for taxpayers is now available on the income tax portal.
- ITR 3 JSON Schema for the annual year 2022-23.
- The Form ITR 2 validation rules V1 for the annual year 2022-23 are available on the income tax e-filing portal.
- The income-tax authority has issued notification No. 134/2021/F.No. 1 78/4/2021-ITA related to the LIC of India for the annual year 2021-22.
- The due date for completion of the penalty proceeding under the Act has been extended from 30th September 2021 to 31st March 2022.
What is the Due-Date for Filing the Form ITR 3?
The date due for filling an ITR is as for individuals & businesses:
- The Annual Year 2022-2023: 31st July 2021 for Non-audit Cases and 31st October 2022 for audit Cases.
- The Financial Year 2020- 21 (the Annual Year 2021 -22): 31st December 2021 (Revised) for Non-audit Cases and 15th March 2022 (Revised) for Audit Cases.
Individuals and Hindu Undivided Families who earn money from their profession or a business can use the ITR 3 Form. ITR-3 cannot be filed if an individual or a Hindu Undivided Family receives income from a business partnership.
Read our Article:Types of ITR (Income Tax Returns)