Tax & Finance · 3 min read
Key Changes in ITR-1, 2, 3 & 4 Forms for FY 2025–26
A quick form-by-form guide to LTCG, buyback losses, F&O, intraday trading and other new disclosures.
The Income Tax Department has notified the revised ITR forms for Assessment Year 2026–27, applicable to income earned during FY 2025–26 (Apr 1, 2025 – Mar 31, 2026). The new forms expand reporting around capital gains, share buybacks, derivatives trading and high-value transactions. If you’ve invested, traded, or sold property this year — these changes affect you.
Here’s a clean, table-led summary of what’s new across each form.
1. Form Applicability at a Glance
| Form | Who Should File |
|---|---|
| ITR-1 (Sahaj) | Salaried individuals, pensioners; income up to Rs 50 lakh |
| ITR-2 | Individuals with capital gains, multiple properties, foreign assets |
| ITR-3 | F&O traders, intraday traders, business & professional income |
| ITR-4 (Sugam) | Presumptive income from business or profession (44AD/44ADA/44AE) |
2. What’s New in Each Form
| Form | Key Updates |
|---|---|
| ITR-1 & ITR-4 | Income from up to 2 house properties now allowed · LTCG under Section 112A up to Rs 1.25 lakh can be reported · New secondary contact fields added. |
| ITR-2 | Detailed capital gains breakup · Separate disclosure for buyback losses · Enhanced foreign asset reporting. |
| ITR-3 | Granular reporting for F&O and intraday trading · Buyback losses captured separately · Expanded business & trading disclosures. |
3. Key New Disclosures
| Disclosure | Why It Matters |
|---|---|
| LTCG (Section 112A) | Equity gains up to Rs 1.25 lakh can now be filed even via simpler ITR-1/4. |
| Buyback Losses | Reported as a separate line item to align with the new buyback tax regime. |
| F&O / Intraday Trading | More detailed turnover & profit reporting expected from active traders. |
| Foreign Assets & Income | Stricter disclosure aligned with global tax-transparency norms. |
| High-Value Transactions | Helps the department cross-check filings against AIS/SFT data. |
4. Important Dates
| Forms Notified On | March 31, 2026 |
| Financial Year | FY 2025–26 (Apr 1, 2025 – Mar 31, 2026) |
| Assessment Year | AY 2026–27 |
Final Word
The revised ITR forms reflect the government’s continued push toward granular, source-linked income reporting. Whether you’re a salaried filer with small capital gains or an active F&O trader, picking the right form — and reporting every disclosure correctly — is more important than ever. Filing the wrong form can lead to a defective return notice under Section 139(9).
Start gathering your broker statements, AIS data, capital gains reports and bank summaries early. The earlier you reconcile, the smoother your return will be.
Disclaimer: This article is for informational purposes only and does not constitute tax advice. Please consult a qualified tax professional.
