ITR-3 New Changes AY 2026-27

Introduction

The Income Tax Department has introduced several important updates in the ITR-3 form for Assessment Year (AY) 2026-27. These changes mainly affect business owners, professionals, freelancers, stock market traders, consultants, and taxpayers earning income from proprietary business or profession. The revised ITR-3 form focuses on better transparency, detailed disclosure requirements, and improved reporting accuracy for different types of income.

Eligibility Criteria for Filing ITR-3 

ITR-3 can be filed by Individuals and Hindu Undivided Families (HUFs) having income from business or profession. The following taxpayers are generally eligible to file ITR-3:

• Proprietors carrying on business or profession

• Freelancers and consultants

• Doctors, lawyers, architects, chartered accountants, and other professionals

• Taxpayers having income from F&O trading, intraday trading, or share trading

• Partners receiving remuneration or interest from partnership firms

• Taxpayers opting for presumptive taxation in certain cases

• Individuals having business income along with salary, house property, capital gains, or income from other sources

Who is Not Eligible to File ITR-3? 

The following persons cannot file ITR-3:

• Companies, LLPs, and partnership firms

• Individuals not having business or professional income

• Taxpayers eligible to file ITR-1, ITR-2, or ITR-4

• Salaried individuals without business income

Major New Changes in ITR-3 for AY 2026-27

1. Separate Disclosure for F&O and Intraday Trading

The updated ITR-3 form now requires separate reporting for:

• Futures & Options (F&O) turnover

• Intraday trading turnover

• Speculative business income

This change improves reporting accuracy for stock market traders and investors.

2. Additional Deduction Reporting

Enhanced disclosure requirements have been introduced for deductions claimed under:

• Section 80G

• Section 80GGC

• Section 80DD

• Section 80U

Taxpayers may need to provide more details while claiming deductions.

3. Capital Gains Reporting Simplified

The earlier requirement of bifurcating capital gains before and after 23rd July 2024 has been simplified in the revised ITR forms. This reduces complexity for taxpayers reporting capital gains transactions.

4. Expanded Crypto Reporting

Taxpayers dealing in cryptocurrencies and Virtual Digital Assets (VDAs) may now need to provide more detailed disclosures in ITR-3.

5. New Business Codes Added

Several new business and profession codes have been introduced for:

• Social media influencers

• F&O traders

• Speculative traders

• Share traders

• Commission agents

Last Date to File ITR-3 for FY 2025-26

Late filing may result in penalty, interest, and loss of certain benefits such as carry forward of losses.

What is the Structure of ITR-3?

The ITR-3 form consists of multiple sections and schedules for detailed income reporting. Major parts of the form include:

How to File Your ITR-3 Online on Income Tax Portal?

The online filing process for ITR-3 generally includes the following steps:

1. Visit the Income Tax e-filing portal

2. Login using PAN and password

3. Select “File Income Tax Return”

4. Choose AY 2026-27

5. Select ITR-3 form

6. Enter business, professional, salary, and capital gain details

7. Report deductions and tax payments

8. Verify tax liability and submit the return

9. Complete e-verification through Aadhaar OTP, EVC, or net banking

Proper books of accounts, bank statements, GST records, and Form 26AS should be kept ready before filing the return.

Business Codes for ITR Forms

Agriculture, Animal Husbandry & Forestry

Author: CA POONAM GUPTA & ADV LOKESH GUPTA