Comprehensive Guide to Filing ITR-3 in India

Learn how to file ITR-3 in India with our handy guide. Discover eligibility criteria, key components, necessary documents, and step-by-step instructions for a smooth filing process.
Home Loan
APPLY
2 min
14 June 2024

In India, the Income Tax Return-3 (ITR-3) form is a crucial document for individuals and Hindu Undivided Families (HUFs) who have income from business or profession. It's designed to cater to taxpayers who need to declare their income under a presumptive taxation scheme, income from partnerships, and other specific sources. This comprehensive guide will walk you through everything you need to know about filing ITR-3, ensuring compliance with tax regulations and maximizing deductions where applicable.

Understanding the eligibility criteria

Before diving into how to file ITR-3, it’s important to understand who is eligible to use this form:

  1. Individuals and HUFs: Those who have income from a business or profession.
  2. Income sources: The form is suitable for those with income from proprietary businesses, professions, salary/pension, house property, capital gains, and other sources.
  3. Exclusions: ITR-3 is not applicable for individuals who are partners in a firm, as they must use ITR-2.

Key components of ITR-3

Filing ITR-3 involves several key components that need to be meticulously filled out:

  1. Personal information: Basic details like name, address, PAN, and Aadhaar.
  2. Income details: Comprehensive income reporting from business/profession, salary/pension, house property, capital gains, and other sources.
  3. Deductions: Claims under various sections like 80C, and 80D.
  4. Tax computation: Calculation of total income and tax liability.
  5. Bank details: Information about all bank accounts held during the financial year.
  6. Verification: Self-declaration affirming the accuracy of the information provided.

Preparation before filing ITR-3

To ensure a smooth filing process, gather the following documents and details:

  1. PAN and Aadhaar card: For identification and verification purposes.
  2. Form 16: If you have salary income.
  3. Bank statements: Reflecting your income and expenses.
  4. Business/professional income details: Income and expenditure details, profit and loss account, balance sheet.
  5. Investment proofs: Documents supporting claims for deductions under sections like 80C, 80D.
  6. Form 26AS: Tax credit statement for the financial year.

Step-by-step guide to filing ITR-3

  • Step 1: Check eligibility for ITR-3:
    Before starting the process, ensure you're eligible to file ITR-3. This form is specifically for individuals and HUFs with income from a proprietary business or profession. Also, if you have income sources like capital gains, income from multiple houses, and income from other sources, you need to file ITR-3.
  • Step 2: Gather relevant documents:
    Arrange all necessary documents like your PAN card, Aadhaar card, bank account details, income and expense details related to your business or profession, balance sheet and profit & loss account details, Form 26AS, and proofs for any tax-saving investments.
  • Step 3: Visit income tax e-filing portal:
    Visit the income tax department's official e-filing portal (www.incometaxindiaefiling.gov.in) and login to your account using your user ID (PAN), password and captcha.
  • Step 4: Select 'Filing of Income Tax Return':
    After login, click 'e-file' option and select 'Filing of Income Tax Return' from the dropdown. Select 'ITR-3' as the ITR form name.
  • Step 5: Complete the form:
    You will be required to fill in various details like personal information, current address, your business or profession code as per the income tax law, details of your income, deductions claimed under various parts of the IT Act, tax details, and more.
  • Step 6: Fill schedule BP:
    This section requires the most detail as it pertains to your business or profession. Information pertaining to your trading account, manufacturing account, profit & loss account, balance-sheet details, and others have to be given here.
  • Step 7: Validate information before submission:
    As you fill in the form, the portal auto-calculates the total income and tax thereon. Once all the relevant data is provided, validate the information. Cross-check the information with your supporting documents diligently to avoid any discrepancies.
  • Step 8: Pay the tax and submit your ITR form:
    Pay off any outstanding tax and then proceed to submit your ITR form. An acknowledgment number will be generated.
  • Step 9: E-verify your ITR:
    The final step is e-verification of your ITR, either via Aadhaar OTP, EVC generated through a bank account, demat account, net-banking, pre-validated bank account, or sending a signed ITR-V (Income Tax Return Verification Form) through regular or speed post.

Remember, the ITR-3 form is significantly more detailed than other ITR forms and may require professional help, especially for those not accustomed to understanding terms used in balance sheets or profit and loss accounts.

Explore Bajaj Housing Finance Home Loan

Now that tax awareness and financial literacy are a part of your life, another aspect you may want to look into is owning your dream home. While managing your finances efficiently is important, the right home loan can help you take a step closer to your dream without creating a financial burden. Here, Bajaj Housing Finance Limited can assist you with a home loan tailored to your needs.

Opting for a Bajaj Housing Finance Home Loan can be a great choice for both businessmen and working professionals. With a simplified application process, flexible repayment tenure and competitive interest rates, it can convert your dream into a reality.

Here are a few reasons why you should apply for a home loan from Bajaj Housing Finance:

  1. Extended repayment tenures: Benefit from repayment periods of up to 32 years, enabling you to select a plan aligned with your financial circumstances for more manageable repayments.
  2. Competitive interest rates: Initiate your journey to homeownership with attractive interest rates starting at just 7.49%* p.a., accompanied by EMIs as low as Rs. 687/lakh*, making homeownership more affordable.
  3. Tailored loan options: Customise your home loan to suit your specific requirements with flexible loan amounts and repayment terms, granting you greater control over the home-buying process.
  4. Top-up loan facility: Enhance your financial flexibility with a top-up loan, providing additional funds of up to Rs. 1 crore* or higher at competitive interest rates and minimal documentation, simplifying balance transfer management.

Just remember, when managing your finances, it's not just about saving tax, but also about investing smartly in assets like a home. If you are looking to buy a house in the future, consider Bajaj Housing Finance Home Loan to fund your dream home.

Bajaj Finserv app for all your financial needs and goals

Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.

You can use the Bajaj Finserv App to:

  • Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.
  • Invest in fixed deposits and mutual funds on the app.
  • Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.
  • Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.
  • Apply for Insta EMI Card and get a pre-qualified limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on Easy EMIs.
  • Shop from over 100+ brand partners that offer a diverse range of products and services.
  • Use specialised tools like EMI calculators, SIP Calculators
  • Check your credit score, download loan statements and even get quick customer support—all on the app.

Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.

Do more with the Bajaj Finserv App!

UPI, Wallet, Loans, Investments, Cards, Shopping and more

GET THE APP

Disclaimer

1. Bajaj Finance Limited (“BFL”) is a Non-Banking Finance Company (NBFC) and Prepaid Payment Instrument Issuer offering financial services viz., loans, deposits, Bajaj Pay Wallet, Bajaj Pay UPI, bill payments and third-party wealth management products. The details mentioned in the respective product/ service document shall prevail in case of any inconsistency with respect to the information referring to BFL products and services on this page.

2. All other information, such as, the images, facts, statistics etc. (“information”) that are in addition to the details mentioned in the BFL’s product/ service document and which are being displayed on this page only depicts the summary of the information sourced from the public domain. The said information is neither owned by BFL nor it is to the exclusive knowledge of BFL. There may be inadvertent inaccuracies or typographical errors or delays in updating the said information. Hence, users are advised to independently exercise diligence by verifying complete information, including by consulting experts, if any. Users shall be the sole owner of the decision taken, if any, about suitability of the same.

Frequently asked questions

Can I file ITR 3 offline?

Yes, you can file ITR-3 offline, but this option is available only to individuals who are at least 80 years old during the previous year or to an individual or HUF whose income does not exceed five lakh rupees and who has not claimed any refund in the return of income.

Can we file ITR 3 without audit?

Yes, you can file ITR-3 without an audit provided your sales or turnover is less than the appropriate threshold under Sections 44AD, 44ADA, or 44AE of the Income Tax Act. However, if the turnover exceeds the threshold or profit is lower than the deemed profit, tax audit becomes mandatory.

Can we shift from ITR 3 to ITR 2?

Yes, you can shift from ITR 3 to ITR 2 if your source of income changes from a business/profession (for which ITR 3 applies) to salaried/Pension income or income from multiple houses or income from Capital Gains (for which ITR-2 applies). It depends on the nature and source of your income.

Show More Show Less

Related videos