Six Key Changes in ITR-2 Excel Utility for AY 2025-26: What Taxpayers Should Know
The Income Tax Department has released the Excel-based utilities for various Income Tax Return (ITR) forms, including ITR-1, ITR-2, and ITR-3 for the Assessment Year (AY) 2025-26. Among these, the ITR-2 form—used by individuals and HUFs with income from salary, capital gains, foreign assets, and other non-business sources—has undergone significant updates this year.
Below are six important changes introduced in the ITR-2 Excel Utility that every taxpayer should be aware of before filing returns for AY 2025-26:
1. Reporting of Capital Loss from Share Buybacks
A new row has been added in Schedule CG – A(A) to allow reporting of capital losses arising from share buyback transactions, in accordance with Section 68 of the Companies Act, 2013. These losses are now considered, provided the related income is disclosed under the head ‘Income from Other Sources’.
2. Separate Disclosure of Dividend Income under Section 2(22)(f)
The form now includes a dedicated row for dividend income falling under Section 2(22)(f). This relates to amounts received by shareholders as part of share buybacks, and must be declared distinctly under dividend income.
3. Detailed Bifurcation for Property Transfers
ITR-2 now mandates separate reporting for:
- Cost of acquisition, and
- Cost of improvement
in case of land and building transfers, distinguishing between transactions made: - Before 23rd July 2024, and
- On or after 23rd July 2024.
This bifurcation enables correct application of indexation benefits under capital gains calculations.
4. Higher Income Threshold for Asset and Liability Reporting
Previously, individuals with total income exceeding ₹50 lakh were required to report their assets and liabilities. From AY 2025-26 onwards, this threshold has been raised. Now, only taxpayers with income exceeding ₹1 crore are obligated to provide this disclosure as of the last day of the financial year.
5. (Optional – Add if required based on complete utility content)
[Placeholder for any additional changes, such as foreign asset disclosures or changes in verification process—can be filled if more details from ITR-2 utility are shared.]
6. (Optional – Add if required based on complete utility content)
[Placeholder for any other specific change in calculation rules or deductions, if applicable.]
Final Note
While these changes aim to streamline and improve transparency in tax reporting, they also require taxpayers to be more diligent when filling out their returns. It is advisable to review the updated ITR-2 Excel Utility thoroughly and ensure accurate reporting of all applicable income and asset details for a smooth and compliant filing experience.
