Form 10-IEA: A Comprehensive Guide

Introduction

Form 10-IEA is a crucial document for taxpayers for AY 2024-2025 and onwards. It allows individuals and Hindu Undivided Families (HUFs) to exercise their right to choose between the old and new tax regimes. This form is particularly relevant for those with income from business and profession.

Historical Context

Before the financial year (FY) 2022-23, individuals had to file Form 10-IE to specify their willingness to choose the new tax regime. However, starting FY 2023-24, the new tax regime has been set as the default. This means that if the taxpayer does not specify their intent to choose the old regime, they will be automatically enrolled in the new regime.

Who Can Use Form 10-IEA?

Form 10-IEA can be used by Individuals, HUF, Association of Persons (AOP) (other than co-operative societies), Body of Individuals (BOI) & Artificial Judicial Persons (AJP) having income from business and profession. They have to 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.

Structure of Form 10-IEA

The Form 10-IEA is divided into three parts:

1. Basic Information: This includes the name of the assessee, PAN, Assessment Year (AY), and status of the person. 

2. Additional Information: This section is related to additional information where the assessee has to give additional information related to IFSC unit (if any).

3.  Declaration and Verification: This part is a declaration and verification by the taxpayer for opting out or re-entering into the new tax regime. 

Filing of Form 10-IEA

The filing of Form 10-IEA is done online through the e-Filing portal. The steps are as follows:

1. Go to the e-Filing portal and click login. 

2. On the Login Page, enter your user ID and password. 

3. On your Dashboard, Go to e- File menu > Income Tax Forms > File Income Tax Forms. 

4. On the page- File Income Tax Forms -‘Persons with Business/Professional Income -select the option-Form-10IEA. 

Legal Provisions

Form 10-IEA has been notified vide Notification No.43/2023 dated 21st June 2023. This form can be filed twice in a lifetime i.e., one for opting out of the new tax regime and one for re-entering into the new tax regime.

Form 10-IEA > FAQs

1. From which Assessment Year Form 10-IEA is applicable?

Form 10-IEA has been notified vide Notification No. 43/2023 dated 21st June 2023- and is applicable from Assessment Year 2024-25 onwards i.e. for A.Y. 2024-25 and upcoming years.

2. Who can file Form 10-IEA on e-filing portal?

The Form can be filed by Individual, Hindu Undivided Family (HUF), Association of persons (other than a co-operative society), Body of individuals (BOI), Artificial juridical person referred u/s 2(31)(vii) (AJP).

3. Why do I need to submit Form 10-IEA?

You will be required to submit Form 10-IEA if you want to opt out / re-enter new tax regime and have Income under the Head “Profits and Gains of Business and Profession.”

4. What are the modes in which Form 10-IEA can be submitted?

Form 10-IEA can only be submitted online on the e-Filing portal.

5. How can Form 10-IEA be e-verified?

The taxpayer can E-Verify the form using Aadhaar OTP, EVC or DSC. You can refer to How to E-Verify user manual to learn more. https://www.incometax.gov.in/iec/foportal/help/how-to-e-verify-your-e-filing-return .

6. Can I add an Authorized Representative to file Form 10-IEA on my behalf?

Yes, you can add an Authorized Representative to file Form 10-IEA on your behalf. You can refer to ‘Authorize / Register as Representative User Manual’ to learn more. https://www.incometax.gov.in/iec/foportal/help/how-to-authorize-signatory

7. What is the time limit for filing Form 10-IEA?

Form 10-IEA should be filed on or before the due date of filing of return as specified u/s 139(1) of the Income Tax Act, 1961.

8. Can I submit Form 10-IEA after filing of Income Tax Return?

In order to get the benefit of filing of Form 10-IEA, it is advisable to file the form before filing of Income Tax Return. Acknowledgement Number and date of filing of Filed Form 10-IEA are required to be provided in the Income Tax Return.

9. While submitting the Form 10-IEA, designation is not getting pre-filled under Verification tab. What should I do?

You are requested to update the “Key Person Details” under “My Profile” section. Re-login to the e-Filing portal and try again.

10. I do not have any business income. While filing Form 10-IEA, I am unable to proceed further if I select “No” for “Do you have income under the head “profits and gains from business or profession” during the assessment year”. What should I do?

In case you don’t have any business, income and are required to file ITR 1/ ITR 2, then there is no need to file Form 10-IEA to opt out/ re-enter the new tax regime under Section 115BAC of the Income Tax Act, 1961. In such case, the option can be exercised while filing the respective ITR form (ITR 1/ ITR 2) on or before the due date specified under section 139(1) of the Income Tax Act, 1961.

11. What should I select for “Due date applicable for filing the return of income”?

You have to select due date applicable for filing the return of income u/s 139(1) of the Income Tax Act, 1961. You can refer to ‘help document’ available on the screen and select applicable option for filing Form 10-IEA

12. Should I need to file Form 10-IEA for every year to ‘opt out’ of new tax regime?

In case you ‘opted out’ of new tax regime in earlier Assessment Year and you want to continue the old tax regime in ITR, you don’t need to file the Form 10-IEA every year.

13. Form 10-IEA is applicable on me and now I want to withdraw the option of old tax regime in my ITR. What is the procedure for the same?

In case you opted old tax regime in earlier Assessment Year and you want to ‘re-enter’ the new tax regime, then you need to file Form 10-IEA for withdrawal of option in the form for the upcoming assessment year.

14. I withdraw the option in Form 10-IEA in previous Assessment Year by filing the form with re-entering option. Can I again exercise the option of old tax regime in Form 10-IEA?

In case withdraw the option in form, you will never be eligible to exercise the option of old tax regime again except when you cease to have income from business or profession.

15. I wanted to opt out of new tax regime in Form 10-IEA, but I filed Form 10-IEA after due date of Income tax return. Will I get the benefit of old tax regime?

In case you want to opt out of new tax regime and you fail to file the form within due date. You will not be eligible to get the benefit of old tax regime in your ITR.

16. I have filed Form 10-IEA and the status of the form is Invalid Form. What should I do?

In case you have filed Form 10-IEA after the due date of income tax return, the status of the form will be Invalid Form. In that case, Form can be filed in subsequent Assessment Year afresh.

17. The status of the filed Form 10-IEA has been changed from ‘Valid Form’ to ‘Invalid Form’. What should I do?

In case correct due date has not been selected while filing of Form 10-IEA, which is applicable for filing your Income Tax Return and your filed Form 10-IEA was not accepted for processing of ITR due to filing of said form after the due date of ITR. In such case, the status of form will get changed to "Invalid Form". In such circumstance, Form 10-IEA can be filed afresh in subsequent Assessment Year.

Conclusion

Form 10-IEA is a significant tool for taxpayers, allowing them to choose between the old and new tax regimes. It is essential to understand the implications of each regime and make an informed decision.