Form 10-IEA notified vide Notification No. 43/2023 dated 21st June 2023 is applicable from Assessment Year 2024-25 onwards i.e. for A.Y. 2024-25 and upcoming years. With effect from A.Y 2024-25, new tax regime has been set as the default tax regime. This means that if the taxpayer does not specify their intent to choose the old regime, the income tax shall be payable as per new regime.
As per section 115BAC(6)(ii) taxpayers without any professional or business income can opt out of the new tax regime directly at the time of filing tax returns (Any number of financial years until the tax payer has any professional or business income).
However if Individuals, HUF, AOP (other than co-operative societies), BOI & Artificial Judicial Persons (AJP) having income from business and profession wish to file their income tax return under the old tax regime, Form 10 IEA is required to be filed to indicate such preference.
Such persons should mandatorily submit Form 10-IEA within the specified time frame under section 139(1) if they want to switch their tax regime from new to old or if they want to re-enter in the new scheme. Please note that “this form can be filed twice in lifetime i.e. one for opt out of new tax regime and one for re-entering in to the new tax regime”. Once the old tax regime is selected, it will be applicable for all subsequent assessment years unless changed the second time. This means 10 IEA files are not to be filed every year.
Before the introduction of Form 10-IEA, Form 10-IE was considered valid to choose the new tax regime. However, it has now been discontinued due to the adoption of the new tax regime as the default tax regime. The discontinuation of Form 10-IE allows the taxpayer to choose the old tax regime by filing Form 10-IEA.
Who Must Submit Form 10-IEA for FY 2024–25?
1. This form is to be filed by taxpayers having income from business or profession i.e. taxpayers filing ITR using ITR-3 or ITR-4.
2. Taxpayers who do not have income from business or profession can simply tick the “Opting out of new regime” in the ITR form without the need to file Form 10-IEA.
Form 10-IEA Due Date
It is mandatory to submit Form 10-IEA online before the deadline prescribed for filing the income tax return (i.e., 15th September for FY 2024-25).
Note that after filing Form 10-IEA, you will get an acknowledgement number. The acknowledgement number is important for tracking the status of Form 10-IEA and referencing it in future communication.
An individual needs to mention this number while filing an ITR.
If an individual forgets to complete the submission of Form 10-IEA before or during the filing of the ITR, they will be unable to choose the old tax regime. The delayed submission of the form of failure to submit means that the income tax department will compute tax as per the new tax regime.
Taxpayers having income other than Business or profession can switch between old tax regime or new tax regime every year while filing return of income within the due date as per section 139(1) of the Act. Taxpayers having income from Business and profession can opt for old tax regime after filing Form 10-IEA within due date u/s 139(1) and then can switch back to new tax regime only once after filing Form 10-IEA again with Re-enter option.
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