ITR 2025: Step-By-Step Tips To Navigate This Year's Tax Filing

As the July 31 deadline for filing ITR 2025 draws closer, taxpayers across India—whether salaried employees, freelancers, or small business owners—are gearing up to compile financial records and complete their tax returns.

But with evolving tax rules and multiple ITR forms, confusion is running high. To help cut through the complexity, Gaurav Makhijani, Associate Partner and Head of Tax (North India & Gujarat) at Rödl & Partner India, shares important tips and considerations for a hassle-free tax filing season.

Who Needs to File ITR in 2025?
Makhijani emphasises that filing a tax return is mandatory for individuals whose total income exceeds the basic exemption limit. “For the Indian Financial Year 2024-25, the basic exemption limit under the old tax regime is Rs 2.5 lakh, whereas under the new default tax regime, it is Rs 3 lakh,” he explains.

However, even those earning below these thresholds may be obligated to file under specific conditions:
Savings deposits exceeding Rs 50 lakh
Cash deposits in current accounts exceeding Rs 1 crore
Electricity bills totalling more than Rs 1 lakh
Foreign travel expenses exceeding Rs 2 lakh
Foreign assets or foreign income ownership
TDS or TCS deductions of Rs 25,000 or more (Rs 50,000 for senior citizens)
Intention to claim a refund or carry forward losses

“These criteria widen the net of who must file an ITR, even if the total income is technically below the taxable limit,” Makhijani adds.
 

Start With Your Residential Status
Before diving into documentation, determine your residential status—a key factor that impacts the scope of taxable income in India and whether foreign income or foreign assets must be disclosed.

You may fall under one of the following:
Resident
Resident but Not Ordinarily Resident (RNOR)
Non-Resident

‘This has a significant impact on the scope of income taxable in India and on foreign asset disclosure requirements,’ noted Makhijani.

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Gather All Income and Deduction Documents
The next crucial step is to collate financial documents. Here's a checklist:
Form 16 from employers
Form 16A from banks or financial institutions
Form 26AS for TDS/TCS details
AIS (Annual Information Statement)
TIS (Taxpayer Information Summary)
Bank interest certificates
Loan statements (especially for housing and education loans)
Demat account statements (for capital gains)
Rent receipts
Investment proofs (ELSS, PPF, NPS, life insurance)
Health insurance premiums
Donation receipts under Section 80G

“These documents not only ensure accurate income reporting but also help taxpayers claim eligible deductions and exemptions,” says Makhijani.

Choose Between Old and New Tax Regime
One of the most critical choices while filing ITR 2025 is selecting the right tax regime.
The old tax regime allows various deductions and exemptions but has higher slab rates.
The new regime offers lower slab rates but disallows most deductions.

“While the new regime is now the default, taxpayers can still opt for the old regime if it's financially beneficial. This choice should be backed by a proper tax liability comparison, based on one’s income and eligible deductions,” Makhijani advises.

Pick the Correct ITR Form
ITR 2025 forms are tailored for specific income types and taxpayer categories. Selecting the wrong form can lead to defaults and even notices from the Income Tax Department.

For example:
ITR-1 (Sahaj) is meant for salaried individuals earning up to Rs 50 lakh.
ITR-2 is for those with capital gains or foreign income.
ITR-3 and ITR-4 apply to professionals and business owners.
The income tax portal provides detailed instructions for each form. “These instructions are helpful, and taxpayers must read them carefully to ensure all fields are properly filled,” says Makhijani.

Use the Government Portal for Filing
The Income Tax Department’s online utility simplifies ITR filing with:
Pre-filled PAN-linked fields
Real-time validation
User-friendly step-by-step guidance

Once the return is submitted, taxpayers can verify it using:
Electronic Verification Code (EVC)
Digital Signature
Or by sending a signed ITR-V via post within 30 days

Final Tips for ITR 2025 Filing
Avoid last-minute rush—start early to avoid errors.
Double-check personal details like PAN, Aadhaar, and bank account.
Cross-verify income with Form 26AS and AIS.
Review deductions to reduce liability.
Save a copy of the acknowledgement for future reference.

Filing your ITR in 2025 doesn’t have to be stressful if you're well-prepared. As Makhijani puts it, “The current online infrastructure has made this process more accessible, efficient, and transparent for individual taxpayers. All it takes is awareness, timely action, and the right guidance.”

Whether you're filing for compliance or to claim a refund, following these must-know tips will ensure your ITR 2025 filing is smooth and penalty-free.