The Central Board of Direct Taxes (CBDT) through Notification No. 40/2025/ G.S.R. 271(E) issued on 29th April, 2025, has released the updated ITR-1 and ITR-4 forms for the Assessment Year (AY) 2025–26, applicable for the Financial Year (FY) 2024–25. These revised forms have introduced additional disclosure requirements, focusing on enhanced transparency and taxpayer accountability.

This blog explores the key changes applicable under the Old Regime, helping you ensure accurate and compliant filing.

AN OVERVIEW OF THE ITR UPDATE

While the structure of ITR-1 and ITR-4 remains mostly the same, the Income Tax Department has mandated specific new data fields aimed at:

• Curbing incorrect or inflated deductions
  
• Strengthening data linkage with AIS/TIS, PAN, and third-party reporting
  
• Enabling targeted scrutiny in case of high-value claims
  
• Let’s break down the newly introduced requirements section-wise.
  

HOUSE RENT ALLOWANCE (HRA) – ADDITIONAL DISCLOSURE

Taxpayers claiming HRA will now be required to disclose the following details:

• Place of Work
  
• Actual HRA Received
  
• Actual Rent Paid – Rent paid during the year
  
• Basic Salary – Essential for computing HRA exemption
  

These disclosures aim to cross-check claims with employer filings and rent receipts.

DEDUCTION IN RESPECT OF LIC, PROVIDENT FUND ETC. (SECTION 80C)

• Policy Number or
• Document Identification Number (DIN)

This will help validate the claim against the records of the issuing institution.

DEDUCTION IN RESPECT OF HEALTH INSURANCE PREMIA. (SECTION 80D)

Those claiming deductions for health insurance premiums must now furnish:

• Name of the Insurance Company
• Policy Number
  

This change ensures verification against actual premium records and prevents double claims.

DEDUCTION IN RESPECT OF INTEREST ON LOAN TAKEN FOR HIGHER EDUCATION. (SECTION 80E)

• Loan taken from (Lender’s Name)
  
• Name of the bank from which loan is taken
  
• Loan account number
  
• Date of sanction
  
• Total amount of loan sanctioned
  
• Loan outstanding as on 31st March
  

These disclosures strengthen the audit trail for education loan deductions.

DEDUCTION IN RESPECT OF INTEREST ON LOAN TAKEN FOR RESIDENTIAL HOUSE PROPERTY (SECTION 80EE)

For deductions under this section, similar disclosures are now mandatory:

• Lender’s name and account number
  
• Name of the bank from which loan is taken
  
• Sanction date
  
• Total loan amount
  
• Outstanding balance as on 31st March
  

DEDUCTION IN RESPECT OF INTEREST ON LOAN TAKEN FOR CERTAIN HOUSE PROPERTY. (SECTION 80EEA)

If you’ve purchased an electric vehicle and claimed interest deduction under this section, you must now disclose:

• Vehicle Registration Number
  
• All other loan details: lender, sanction date, total loan amount, and outstanding balance as on 31st March
  

This aligns with the government’s EV incentives and promotes targeted benefit tracking.

DEDUCTION IN RESPECT OF MEDICAL TREATMENT, ETC. (SECTION 80DDB)

This deduction is available for the treatment of specified diseases like cancer, etc.

• You must now specify the Name of the Disease for which the deduction is claimed.

This enhances medical deduction authenticity and compliance.

If you’re a taxpayer or a practitioner assisting in return filing, here’s what you should be prepared with:

• Keep loan sanction letters and bank certificates handy
• Verify insurance and investment policy numbers
• Collect accurate salary, rent, and HRA detail
• Ensure all medical claims are backed by diagnosis and prescription documents

These changes don’t necessarily complicate filing but demand better documentation and attention to detail.

The latest updates to ITR forms for AY 2025–26 reflect the Income Tax Department’s push toward greater transparency and compliance. With added requirements around loans, insurance, and deductions, it’s more important than ever to ensure your return is filed accurately and backed by proper documentation.

If you're unsure which ITR form is right for you or just want to understand the bigger picture, check out our complete guide on ITR forms - it’s a great starting point.

Need assistance with filing your return? Explore the tax filing services provided by us at TaxOSmart — designed to make your ITR filing smooth, error-free, and compliant.

DISCLAIMER
The information contained in this document is prepared by R.J. Soni & Associates and TaxOSmart LLP (hereinafter referred to as RJSA) for information purpose only. It does not constitute any legal advice or tax advice. In no way, this document should be treated as a marketing material or efforts to solicit a client. While we have made every attempt to ensure that the information contained in this document is true, RJSA, its partners and/or any of its employees make no claims / guarantee about its accuracy, completeness, or up-to-date character, or warranty, express or implied, including the warranty of opinions expressed for a particular purpose, or assume any liability or responsibility for the accuracy, completeness, or usefulness of any information available from this document.