ITR Filing 2025: New Deadline, Capital Gains Rules, and Key Tax Changes Explained

The income tax return (ITR) filing season for assessment year 2025 is underway, and this year there's a host of changes, particularly in the treatment of capital gains. Taxpayers have been advised to pay close attention to the revised deadlines, slab rates, and updated filing requirements following the announcements made in Budget 2024.

The deadline for filing ITR for salaried individuals and Hindu Undivided Families (HUFs) not requiring audit has been extended to September 15, 2025, offering taxpayers additional time to adjust to the changes. Businesses and professionals who are subject to audit must file their returns by October 31, 2025. Belated and revised returns can be filed by December 31, 2025, although late filings will attract penalties and interest.

A critical aspect for investors this year is the July 23, 2024 cut-off for the application of new capital gains tax rules. As per the amended provision, gains from the sale of assets on or after this date will be taxed under the new regime, while those sold prior will fall under the previous structure. Taxpayers are required to bifurcate capital gains accordingly in their returns, and updated ITR forms now reflect this requirement.

Under the new capital gains framework effective from July 23, 2024, long-term capital gains (LTCG) across all asset classes, including equities, gold, and property, are to be taxed at a flat 12.5%, up from the earlier 10% in certain cases. Short-term capital gains (STCG) on financial assets such as equities will be taxed at 20%, replacing the earlier 15% rate. In a relief to equity investors, the LTCG exemption threshold has been raised from ₹1 lakh to ₹1.25 lakh, and financial assets held for over 12 months will now be classified as long-term.

For real estate, the LTCG tax has been brought down from 20% to 12.5%. However, the benefit of indexation has been removed for properties purchased after April 1, 2001. Following criticism, the government allowed sellers of assets acquired before July 23, 2024 to choose between the old tax structure (with indexation) or the new regime, depending on which proves more beneficial. Finance Minister Nirmala Sitharaman stated on August 7, 2024 that the intention behind the new structure was to simplify and unify the capital gains regime across asset classes.

Another key change from Budget 2024 includes an enhancement in the deduction for employer contributions to the National Pension System (NPS) under the new regime. For private sector employees, this deduction has been increased from 10% to 14% of basic salary, bringing it in line with the benefit already extended to government employees. The 10% cap continues to apply under the old tax regime.

Taxpayers holding foreign assets or receiving stock options from overseas employers also see some relief this year. While such assets must still be disclosed in the ITR, the penalty under the Black Money Act for failing to report foreign financial holdings up to ₹20 lakh has been waived. Previously, non-disclosure could attract penalties of up to ₹10 lakh.

Moreover, this financial year introduces revised income tax slabs under the new regime, offering lower tax liability for many salaried individuals without the need to claim exemptions. The standard deduction has been increased to ₹75,000 under this regime.

In summary, the 2025 ITR season demands greater caution and awareness from taxpayers. The July 23 capital gains cut-off, updated NPS provisions, and new slab structures all represent substantial shifts in India's tax landscape. Taxpayers are advised to carefully assess their financial data and make informed decisions regarding the choice of tax regime, capital gains treatment, and foreign asset reporting.