ITR filing for AY 2025-26: 7 ITR Excel Utilities Changes for FY 2024-25 that Can Impact Taxpayers (Including Salaried Employees)
Every year, taxpayers encounter some changes in the tax filing rules, making the process complicated and taxing for them. This year is no exception as the IT department has introduced several key changes in the ITR validation rules. Taxpayers, primarily salaried persons and those having home loans, house rent, or electric car loans, will be impacted by these updates as they report the validation rules income earned during FY 2024-25.
As of now, the department has released only the Excel filing utilities for ITR-1 and ITR-4. These changes are enhanced declarations, and experts believe that they are aimed at curbing false claims of deductions during tax filing. Before the implementation of these changes, the tax deduction’s validity was manually verified during ITR processing. With this year’s updates, the process will be conducted at the ITR filing level. At the same time, it will be automated, reducing the possibility of human error and accelerating ITR processing.
Let us discuss how these changes will redefine ITR filing for AY 2025-26.
Key Changes in ITR Validation Rules for FY 2024-25 (AY 2025-26)?
A majority of changes in ITR validation rules address tax deductions under the old tax regime. The following changes are a part of the ITR filing utility for FY 2024-25 (AY 2025-26):
1: House Rent Allowance (HRA) Enhanced Disclosure
HRA deduction is one of the key exemptions claimed by taxpayers, which is the reason this change has been mandated. Taxpayers are now required to provide comprehensive details to claim HRA exemption. These include
Place of work
Actual rent paid
Actual HRA received
Basic salary and dearness allowance
40% or 50% of the basic salary, based on whether the city is non-metro or metro
2: Section 80C
Taxpayers seeking Section 80C tax deduction must now reveal the document identification number or policy number to claim the deduction. Section 80C allows a deduction of up to a Rs 1.5 lakh threshold to taxpayers investing in instruments such as life insurance policies, tax-saving FDs, and PPFs.
3: Section 80D
The next change applicable in AY 2025-26 relates to Section 80D deduction for medical/health insurance. Taxpayers must provide health insurance details such as the policy or document number and the name of the insurance company.
4: Section 80E
Section 80E covers deductions on interest paid on education loans. To claim these deductions, the following details have to be submitted mandatorily from AY 2025-26:
Bank name
Name of the lender
Loan account number
Total loan amount
Loan sanction date
Interest on the loan
Outstanding loan as of 31st March
5: Section 80EE / 80EEA
Section 80EE/80EEA is for interest on home loans for residential properties. From AY 2025-26, taxpayers claiming deductions under these sections must disclose the following details:
Bank name
Name of the lender
Loan account number
Total loan amount
Loan sanction date
Outstanding loan as of 31st March
6. Section 80EEB
Section 80EEB allows deductions on interest paid on loans for buying electric vehicles to encourage eco-friendly vehicles in India. From this year, taxpayers can claim a deduction under this section only if they furnish the following information:
Bank name
Name of the lender
Loan account number
Total loan amount
Loan sanction date
Outstanding loan as of 31st March
Section 80DDB
Under Section 80DDB, taxpayers can claim deductions for the treatment of specified diseases. A valid claim from AY 2025-26 requires them to mention the name of the specified disease.
The Takeaways
These new updates are listed in the ITR-1 and ITR-4 forms for AY 2025–26. For instance, taxpayers only had to enter the HRA exemption manually to claim a deduction in the previous ITR forms. Supporting documents were not required until they were specifically asked for upon scrutiny. However, the ITR utility now seeks these details upfront, making it clear that the department is focusing on pre-validation and heightened transparency in compliance.
Experts note that the IT department wants more vigilance and control over false claims of deductions under the old regime. For this reason, new validation rules have been introduced in the e-filing portal. The data being uploaded should be accurate and compliant with these validation rules, failing which an error message will be displayed and the ITR will not be allowed to be uploaded.
These new rules will no longer allow taxpayers to claim tax refunds based on false claims or forged documents.