ZenIT || How to File Form 10IEA
Form 10IEA : Meaning and Benefits of Form 10IEA:
The Budget 2023 proposed to make the new tax regime the default, with a new Form 10-IEA introduced to allow taxpayers to opt for the old regime if they prefer. This form must be filed before the due date for filing an income tax return. In this guide, we explore various aspects of Form 10-IEA, including its meaning, purpose, components, and more.
What is Form 10-IEA:
In the Budget 2023, the new tax regime became the default option. Simply put, individuals who prefer the old tax regime must explicitly choose this option by following the required process. Form 10IEA serves as the tool for taxpayers to exercise their right to select either the old or the new regime. By completing this form, taxpayers can communicate their choice to the income tax department.
What are the Amendments Made in Form-10IEA:
Until the fiscal year 2022-23, when the new tax regime was not the default, individuals were required to submit Form 10-IE to express their choice for the new tax regime. However, starting from the financial year 2023-24, the new tax regime has been established as the default option. This implies that if a taxpayer doesn't explicitly state their intention to opt for the old regime, they will automatically be enrolled in the new regime.
The defaulting to the new tax regime is particularly applicable to individuals without any professional or business income, allowing them to opt out directly when filing their tax returns. The new form now serves as a means for individuals to indicate their preference for the old tax regime.
This streamlined procedure provides a more efficient method for individuals without business or professional income who favor the traditional tax regime. They no longer need to go through the additional step of filing Form 10-IE; instead, they can straightforwardly express their preference during the tax return filing process by selecting the relevant option.
What is the Purpose of Form 10-IEA:
1) Individuals with income from business and profession are obligated to submit Form 10-IEA within the specified time frame under Section 139(1) if they wish to transition from the new tax regime to the old one.
2) Completing Form 10-IEA involves providing essential information such as PAN number, assessment year, name, and current status. This information is crucial for accurately categorizing and identifying taxpayer details.
3) Another significant aspect of Form 10-IEA is the individual’s decision to either opt out or re-enter the default new tax regime. This choice determines the rules and regulations applicable to Form 10-IEA.
4) Individuals must also specify the relevant dates for opting out or re-entering the new tax regime when filling out Form 10-IEA.
5) Gathering this information and recording the pertinent dates and choices of individuals contributes to the government's transparency in managing Form 10-IEA. It not only aids in determining the taxpayer’s tax regime preference but also facilitates the maintenance of accurate and up-to-date tax records.
Choosing the Old Tax Regime:
Taxpayers who do not have any income from business or profession can choose the old tax regime by simply clicking the old regime checkbox at the time of filing ITR. However, for those who have income from business/profession, it is mandatory to fill Form 10-IEA to opt for the old regime before the ITR filing due date, i.e. 31st July.
When to Submit Form 10-IEA:
Form 10-IEA should be submitted before filing your income tax return. Upon filing Form 10-IEA, an acknowledgment number will be generated and provided to you. Any individual with business income who wishes to opt for the old regime can file this form by the due date, i.e., Form 10-IEA.
Reasons for Discontinuation of Form 10-IE:
Form 10-IE, previously used for opting into the new tax regime, has been discontinued with the establishment of the new tax regime as the default option. Applicable up to FY 2022-23, its discontinuation aligns with the introduction of Form 10-IEA, which allows individuals to choose the old tax regime.
How to process in Software:
Step 1:
Go to Transaction >> Filing Information:
Step 2:
Click on Form 10 IEA:
Step 3:
Check Mark On 'Opting Out of new Tax regime 115BAC(6)' and then Click on 'e-Filing' Button
The software is programmed to submit the form on the Income Tax portal automatically, so please do not interrupt the process.
Hope this article has provided you with insights into Form 10-IEA and its various aspects. If you intend to continue with the old tax regime, remember to file Form 10-IEA before the ITR filing due date, i.e., 31st July 2024. Additionally, Form 10-IEA can only be filed electronically, either using a digital signature or an electronic verification code. If you still have doubts or need assistance with anything tax-related, KDK tax experts will guide you through every step.
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