This Return Form is to be used by an individual or a Hindu Undivided Family who is having income under the head ―’profits or gains of business or profession’ and who is not eligible to file Form ITR-1 (Sahaj), ITR-2 or ITR-4 (Sugam). Thus income from a Proprietorship Firm.

Thus Individuals & HUFs with following Income can file ITR-3

• Income from carrying on a Profession

• Income from Proprietary Business

• Return may also include income from House property, Salary/Pension and Income from other sources

Who is not eligible to use ITR-3 Form 

If an Individual/HUF is having income as a partner of a partnership firm that is carrying out business/profession, he cannot file ITR-3. In such cases, he is required to file ITR 2. It cannot be filed by a Company or LLP or other types of legal entity.

Income Tax Rates for Individuals & HUF (AY 2021-22)

Note: A resident individual having taxable income upto Rs 5,00,000 will get a tax rebate of Rs.12,500 or the amount of tax payable (whichever is lower)

Note: A resident individual having taxable income upto Rs 5,00,000 will get a tax rebate of Rs.12,500 or the amount of tax payable (whichever is lower)

New Tax regime from AY 2021-22

An option to pay lower tax shall be available only if the Income is calculated without claiming the following exemptions and deductions:

Special Rate under New Tax regime for Individuals & HUF (AY 2021-22)

Surcharge: In case total income exceeds specified limits, surcharge is levied at the following rates:   

Health and Education Cess: The amount of income-tax and the applicable surcharge, shall be further increased by health and education cess calculated at the rate of 4% of such income-tax and surcharge