Introduction

With the introduction of Section 115BAC, taxpayers in India can now choose between the old tax regime (with deductions and exemptions) and the new tax regime (with lower slab rates but fewer deductions).

While both sections deal with TDS on payments for services, they apply to different types of services, and the rates, thresholds, and rules vary significantly.

To opt for the new tax regime, certain taxpayers—especially those with business or professional income—must submit Form 10IE before filing their Income Tax Return (ITR).

This guide explains who needs Form 10IE, when it must be filed, step-by-step instructions, and key rules for taxpayers making the switch.

What Is Form 10IE?

Form 10IE is the official declaration form used to:

• Opt for the new tax regime under Section 115BAC

• Inform the Income Tax Department before filing ITR

• Ensure correct application of slab rates for the financial year

The form is filed online through the income tax e-filing portal.

Who Should File Form 10IE?

✔ Required for:

• Individuals and HUFs having Business or Professional Income Filing Form 10IE is mandatory to opt for the new tax regime

• Taxpayers opting out of the new regime in subsequent years If previously opted in, they must notify withdrawal.

❌ Not required for:

• Salaried individuals choosing the new regime directly while filing ITR (for FY 2023-24 onwards, default regime is new tax regime)

• Those with no business income, except where switching between regimes in earlier years.

Old Regime vs New Regime (Section 115BAC)

New Tax Regime – Lower Slabs, No Major Deductions

• Lower income tax rates

• No exemptions like 80C, 80D, HRA, LTA, and many others

• Simpler structure, fewer compliances

Old Tax Regime – Higher Slabs, More Deductions

• Allows major deductions (80C, 80D, 80G, etc.)

• Suitable for taxpayers with high investment and deduction claims

Form 10IE is essential for those who want to choose the new regime intentionally, especially when income structure varies.

Details Required in Form 10IE

Taxpayer must provide:

• Name, PAN, Address

• Assessment Year

• Whether having business/professional income

• Nature of business/profession

• Confirmation of opting for 115BAC new regime

• Date of filing

Step-by-Step Process to File Form 10IE

Step 1: Log In to the Income Tax Portal

Visit: https://www.incometax.gov.in

Step 2: Navigate to Form 10IE

Go to: e-File → Income Tax Forms → File Income Tax Forms → Form 10IE

Step 3: Select the Assessment Year

Step 4: Fill Basic Details

PAN, name, address, date of birth, nature of business, etc.

Step 5: Choose New Tax Regime (115BAC)

Step 6: Verify Submission

Submit using:

• Aadhaar OTP

• Digital Signature Certificate (DSC) (if applicable)

• Electronic verification (EVC)

Step 7: Download the Acknowledgment

Important Rules About Form 10IE

✔ Once opted for the new regime:

• Individuals with business income can switch back only once.

• After switching back, the old regime becomes permanent unless business income ceases.

✔ For salaried individuals:

• They may choose regime every year while filing ITR (if no business income).

✔ Incorrect or late filing may cause:

• Incorrect tax computation.

• Departmental mismatch

• Rejection of claimed regime

When Should You File Form 10IE?

• Before filing your ITR for the relevant Assessment Year

• Preferably before the due date (31 July / 31 October depending on audit applicability).

Practical Example

A self-employed consultant wishes to switch to the new tax regime for FY 2022-23.

They must file Form 10IE before filing ITR-3, otherwise the old regime will be applied automatically.

Conclusion

Form 10IE plays a crucial role in enabling taxpayers—especially those with business income—to legally opt into the new tax regime under Section 115BAC.

Filing it correctly ensures the right slab benefits are applied and prevents computation errors during ITR filing.

Bisways Consulting Group assists taxpayers with Form 10IE filing, tax regime evaluation, ITR preparation, and personalised tax planning to help choose the most beneficial option.