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Form ITR 3 For FY 2017-18 & AY 2018-19

Last Update Date : November 30, 2018

ITR 3 AY 2017-18

Recently, the Income Tax Department renamed ITR Form 4 to ITR Form 3. The filing of ITR 3 form, for business professionals, is applicable only for AY 2017-18. If you had filed ITR-3 during FY 2015-16, then you will need to file ITR-2, from hereon. The procedure to file ITR form 3 is not complex, once understood.

What is ITR 3?

It is a type of Income Tax Return form to be used by individuals or HUF’s deriving income from proprietary business or profession.  It is to be used for Assessment Year 2018-19 by the groups mentioned below to file their returns.

ITR 3 is applicable to whom?

It is mandatory for you to furnish the return electronically if you fall in any of the following categories:

  • Assessees with income from profit and gain of any business or profession
  • Assessees having income from partnership firm
  • Resident assessees having assets outside India
  • Assessees claiming relief u/s 90, 90A or 91 for whom Schedule FSI & TR are applicable

[ Read: Which ITR to File? ]

Who is not eligible to file ITR 3?

As, ITR-3 form is used for business returns, any individual filing his/her personal income tax return, ie. Salaried employee or filing using ITR 1 form, does not have to file ITR3.

ITR 3 vs ITR 4

ITR-3 form is simply the old ITR-4 of AY 2016-17 form, which will be  used from AY 2017-18.

How to File ITR 3?

itr 3 form download

Click Image to Download ITR 3 for AY 2018-19

 

You can file ITR-3 form with the Income Tax Department online through any of the following ways

Method 1: by furnishing the return electronically under digital signature;

Method 2: by transmitting the data in the return electronically under electronic verification code;

Method 3: by transmitting the data in the return electronically and thereafter submitting the verification of the return in Return Form ITR-V.

In case where the books of accounts are required to be audited under section 44AB, the return shall be filed as per “Method 1”.

In case an assessee is required to furnish a report of audit under sections 10AA, 44AB, 44DA, 50B, 80 -IA, 80-IB, 80-IC, 80-ID, 80JJAA, 80LA, 92E, 115JB or 115JC, he shall file such report electronically on or before the date of filing the return of income.

Where the Return Form is filed as per “Method 3”, the assessee should print out two copies of Form ITR-V. One copy of ITR-V, duly signed by the assessee, has to be sent by ordinary post to Post Bag No. 1, Electronic City Office, Bengaluru–560500 (Karnataka). The other copy may be retained by the assessee for his record.

[ File: Business Tax Return ]

How to File ITR 3 with H&R Block India?

Filing Income Tax Return with H&R Block is a simple 4 steps process

  • Provide your basic details and we will call back within 24 hours
  • Upload or Email your tax documents to the tax expert and complete the payment process
  • Get your return prepared and filed with maximum deductions and tax savings

Filing ITR 3 - Business Tax Return

How to File ITR 3 offline?

ITR-3 cannot be filed in manual or paper form; it has to be mandatorily e-filed for all types of taxpayers.

General Instructions to Fill the Form

  • All items must be filled in the correct manner or it can be held defective or even invalid.
  • If any item is inapplicable, write “NA” against that item.
  • Write “Nil” to denote nil figures.
  • Except as provided in the form, for a negative figure/ figure of loss, write “-” before such figure.
  • All figures should be rounded off to the nearest one rupee. However, the figures for total income / loss and tax payable be finally rounded off to the nearest multiple of ten rupees.

 

How to Fill ITR 3?

The form should be filled up as per the sequence mentioned below:

  • Part A
  • Schedules
  • Part B
  • Verification
  • Details relating to TRP and counter signature of TRP if return is prepared by him.

This return form has the following components:

Part A – 5 sub-divisions:

  • Part A-GEN: Basic information about individual and business (ex: PAN, Aadhaar etc.)
  • Part A-BS: As of 31st March 2018, the balance sheet
  • Part A-P&L: The Profit/Loss for FY 2017-18
  • Part A-OI: Miscellaneous information which is optional and not liable for audit u /s 4AB
  • Part A-QD: Numerical details about the principal traded item of goods traded, which is optional and not liable for audit u/s 44AB

Part B – Contains details of income and total taxes due and is followed by:

  • Statutory verification
  • Details of any third party used for preparing taxes, if applicable

34 Schedules

  • Schedule-S: The calculation of income under head salaries
  • Schedule-HP: House income calculations
  • Schedule-BP: Profit/gains computations from business or profession
  • Schedule-DPM:  Values of plan and machinery depreciation
  • Schedule DOA: Depreciation values of other assets
  • Schedule DEP: Total value of depreciated assets
  • Schedule DCG: Capital gains on depreciated assets
  • Schedule ESR: Section 35 deductions (scientific research expenses)
  • Schedule-CG: Total of capital
  • Schedule-OS: Other income sources data
  • Schedule-CYLA: Income statement after losses set off
  • Schedule-BFLA: Income statement after losses set off, which were brought forward from previous years.
  • Schedule-CFL: Losses to be carried forward for future use
  • Schedule-UD: Details of depreciation that is unabsorbed
  • Schedule-ICDS: Income calculated by disclosure standards in profits.
  • Schedule-10A: Details of deductions u/s 10A

Latest Changes to ITR 3 AY 2018-19

Changes in ITR 3 Details
More details of salary and house property income Old ITR form required the taxpayers to report only the taxable amount but the new ITR forms require you to report detailed calculation of income from salary and house property.
Penalty for late filing of ITR A new field has been added where the late filers need to provide the details of late filing fees paid.
Capital gains as a result of transfer of unquoted shares A new filed has been added for the taxpayers to provide information on unquoted shares in accordance with the amendment in the section 50CA of the Finance Act, 2017.
Reporting gifts A field has been added to report the amount taxable as gift.
Revised depreciation schedule Depreciation schedule has been revised as per which, the highest rate of depreciation for any block cannot exceed 40%.
Claiming proportionate depreciation A new field has been added to report the claim of proportionate depreciation in the event of business reorganisation, i.e. demerger, amalgamation, etc.
Changes in Schedule PL Schedule PL has been modified for the taxpayers to provide GST related details.
Credit of refund to foreign bank account A field has been added where an NRI taxpayer can provide the details of a foreign bank account in which he wants the credit of the tax refund he wants to claim.
Reporting disallowance of expenses A new field has been added to report disallowance of expenses in case of TDS default.
Claiming credit of TDS deducted in the name of another person A new field has been added to facilitate the claim for TDS credit where the TDS was deducted in the name of another person or from a common pool or other similar situations.
Change of applicability for a partner in a firm Partners cannot use ITR 2 – for the Assessment Year 2018-19, an individual or an HUF, who is a partner in a firm, shall be required to file his ITR in Form ITR 3 only.
Claiming relief under DTAA The form now asks the taxpayer claiming relief as per DTAA to report more details like rate as per treaty, rate as per I-T Act and applicable rate etc.
Claiming exemption on capital gains The taxpayers now need to provide more details in the form if they are claiming capital gains exemption.
Reporting remission or cessation of trading liability New forms require separate reporting of remission or cessation of trading liability in case of income from other sources.
Reporting GST payments and refunds New columns have been introduced in the ITR forms to report the details of GST paid and refunded.
Removal of gender Taxpayers now do not need to mention their gender in the form.

All these changes have been made by the tax department in the ITR form are aimed at making the assessment procedure online. Therefore, we can see that the department is seeking more and more information from the taxpayers to facilitate e-assessment.

Changes in ITR 3 Details
As per schedule AL, details of assets and liabilities of individual/HUF with income exceeding Rs 50 lakh Costs of immovable(jewellery, shares, cash balance, etc.) assets/properties
Chartered Accountant/Firm Registration number Provide registration number of chartered accountant auditing your ITR form.
Aadhaar Number As per section 139AA, taxpayers must quote aadhaar number or aadhaar enrolment number while filing ITR.
Explanations of unexplained income and income from dividends Unexplained credits from investments and dividends over Rs. 10 lakh, need to be furnished under schedule OS.
Details of cash deposited during demonetisation Cash deposits of Rs 2 lakh and more made during 9th November 2016 – 30th December 2016, in bank accounts or loan accounts need to be reported.

Send ITR-V to Income Tax Department, CPC Bangalore

If you e-file your return, and wish to mail it to CPC Bangalore, print out the form from your email and sign it and send it to the CPC office in Bangalore.

The preparation and filing of ITR Form 3 is a change that can be taxing, however, the experts at H&R Block can help you every step of the way, so that the transition is smooth and effortless.

Not sure how to file your Business Tax Return? Let H&R Block help you file your taxes.

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