Good News: Claim Section 87A Tax Rebate with Revised or Belated ITR for FY 2023-24

Introduction

The Income Tax Department has announced welcome relief for taxpayers eligible for the Section 87A tax rebate for FY 2023-24 but were unable to claim it. In a late-night update on December 31, 2024, the department shared that eligible taxpayers will soon be able to file a revised or belated Income Tax Return (ITR) to claim their rebate.

Here’s everything you need to know about this update:

What is Section 87A?

Section 87A provides a tax rebate to individuals whose taxable income does not exceed ₹5 lakh. For eligible taxpayers, the maximum rebate is ₹12,500, effectively reducing their tax liability to zero.

What Happened Previously?

Many eligible taxpayers found that they were unable to claim the Section 87A rebate due to discrepancies in the ITR-2 and ITR-3 forms. This led to concerns about missing out on a crucial tax benefit.

The Latest Announcement

The Income Tax Department has acknowledged the issue and announced that taxpayers can now:

• File a revised ITR if they have already submitted their return but missed claiming the rebate.
• File a belated ITR if they missed filing their return altogether.

Both options will be available soon through the ITR filing utility or the online e-filing portal.

What Should You Do Next?

1. Check Eligibility: Ensure your taxable income for FY 2023-24 is within ₹5 lakh and meets the criteria for claiming Section 87A.
2. Prepare Documents: Gather all necessary income and deduction details for accurate ITR filing.
3. Use the Portal: Keep an eye on the e-filing portal for updates on when this functionality becomes available.

Why This Matters

This update ensures eligible taxpayers do not miss out on the benefits they’re entitled to. Filing a revised or belated ITR can help you save significantly on your tax liability.

Final Thoughts

The Income Tax Department’s proactive approach in resolving this issue is commendable. If you’re eligible for the Section 87A rebate but missed claiming it, this is the perfect opportunity to rectify your return and claim the tax relief you deserve.

Stay updated, and don’t let this chance slip away!