Form 10-IEA: How Business Owners Opt Out of the New Tax Regime (Step by Step)

The short answer

Form 10-IEA is the declaration you file on the income tax portal when you have business or professional income and want to be taxed under the old regime instead of the default new regime. If you skip this form or file it late, the new regime applies to you for that year — and you cannot claim old-regime deductions. Salaried people do not need this form at all.

What Form 10-IEA actually is

From assessment year 2024-25, the new tax regime became the default regime. It was Section 115BAC of the Income-tax Act, 1961; under the new Income-tax Act, 2025 it is Section 202.

Most salaried taxpayers can switch between the old and new regime every year by simply selecting an option while filing their ITR. That easy choice is not available to taxpayers who earn income from a business or profession. For them, the regime choice is a formal declaration — and that declaration is Form 10-IEA.

Think of it this way: the form is how a business owner tells the Income Tax Department, in writing and on record, “do not put me in the default regime this year; I want the old regime.”

Who must file Form 10-IEA

You need Form 10-IEA if both of these are true:

1. You are an individual, HUF, association of persons (AOP), body of individuals (BOI), or artificial juridical person, and
2. You have income under the head profits and gains of business or profession, and you want the old regime.

In practice, this covers:

• Freelancers and consultants (IT, design, marketing, content, gig work)
• Self-employed professionals — doctors, lawyers, architects, chartered accountants
• Shop owners, traders, and small business proprietors
• Partners in firms with professional income
• Anyone filing ITR-3, ITR-4, or ITR-5 who wants old-regime treatment

The same form is also used in the reverse direction: if you opted out earlier and now want to return to the new regime, you file Form 10-IEA again for that switch.

Who does NOT need to file Form 10-IEA

This is where most of the confusion sits. You do not file Form 10-IEA if you have no business or professional income. That means:

• Salaried employees and pensioners
• People with only house property income, capital gains, or interest income

For these taxpayers there is nothing extra to file. You simply pick old or new regime inside the ITR each year (ITR-1 or ITR-2), and you can change your mind every single year without penalty or paperwork.

If someone tells a salaried person they “must” file Form 10-IEA, that advice is wrong.

The deadline that decides everything

Form 10-IEA must be filed on or before the due date for filing your income tax return — the Section 139(1) due date under the old Act, which is now Section 263 of the Income-tax Act, 2025.

For most individuals with business income (no audit), that due date is generally 31 July of the assessment year. Check the income tax portal for the exact date in the year you are filing, since extensions do happen.

Miss the deadline and the consequences are harsh:

• The form filed late is invalid
• The new regime applies by default for that year
• Old-regime deductions (80C, 80D, HRA, home loan interest and the rest) cannot be claimed for that year

There is a second trap hidden inside the first. If you file your return late, you have already missed the due date — and with it, your chance to opt out. A business taxpayer who wants the old regime therefore cannot afford to file late at all. The cost is not just a late fee under Section 234F (now Section 428 of the 2025 Act). The cost is the entire regime choice.

The switch rule: what “limited switching” really means

Taxpayers without business income can switch regimes every year, freely. Taxpayers with business or professional income cannot. The rule is strict and worth understanding before you file:

1. You file Form 10-IEA to opt out of the new regime and take the old regime. You can then continue in the old regime in later years without filing the form again.
2. If you later want to return to the new regime, you file Form 10-IEA once more for that withdrawal.
3. After that return to the new regime, you cannot opt out again while you continue to have business or professional income.

In short: one opt-out, one return. That is the full lifetime quota, as long as the business or profession income continues. If your business or professional income stops altogether, the restriction lifts and you go back to the flexible yearly choice.

This is why the regime decision deserves real thought for business owners. A salaried person makes it fresh every July. You make it with consequences.

Form 10-IE vs Form 10-IEA — do not mix them up

Many older articles still mention Form 10-IE. That form belonged to the earlier years (AY 2021-22 to AY 2023-24), when the new regime was optional and you filed to opt into it.

From AY 2024-25 the direction reversed: the new regime is the default, so the live form is Form 10-IEA, used to opt out of it. If a guide tells you to file Form 10-IE today, it is outdated. The form you need is 10-IEA.

Step-by-step: how to file Form 10-IEA online

The form is filed only online, on the income tax e-filing portal. Here are the steps:

1. Log in to incometax.gov.in with your PAN and password.
2. Go to e-File → Income Tax Forms → File Income Tax Forms.
3. Select Form 10-IEA from the list and choose the correct assessment year.
4. Fill in the details: PAN, assessment year, nature of business or profession, and the declaration choosing the old regime (or withdrawing an earlier choice, as the case may be).
5. Submit and e-verify the form using Aadhaar OTP, EVC, or digital signature.
6. Save the acknowledgement number. The ITR utility will ask for it when you file your return claiming the old regime.

File the form before you file your ITR for the year, or at least in the same session before the due date. Filing the ITR first and the form later does not work — the form must exist on or before the due date.

A practical example

Meera is a freelance UI designer earning about ₹18 lakh a year. She pays ₹1.5 lakh into PPF and ELSS (80C), ₹25,000 for health insurance (80D), and claims home loan interest on a let-out property. Under the old regime, her total deductions cross ₹2.5 lakh, and her tax bill comes out noticeably lower than under the new regime.

Meera files ITR-4. Because she has professional income, simply selecting “old regime” in the return is not enough. She must file Form 10-IEA on the portal before 31 July. Once filed, she keeps the old regime in later years without refiling — unless she decides to switch back to the new regime, which she can do only once.

Frequently asked questions

Who needs to file Form 10-IEA?

Individuals, HUFs, AOPs, BOIs, and artificial juridical persons who have income from business or profession and want to be taxed under the old regime instead of the default new regime. This includes freelancers, consultants, proprietors, and professionals filing ITR-3, ITR-4, or ITR-5. Salaried taxpayers without business income never need this form.

What is the due date for Form 10-IEA?

It must be filed on or before the ITR filing due date (Section 139(1), now Section 263 of the Income-tax Act, 2025) for the relevant assessment year. For most individuals with business income and no audit requirement, that is generally 31 July. Always confirm the exact date on the income tax portal for the year in question.

Can a business owner switch back to the new regime after opting out?

Yes, but only once. After you opt out of the new regime using Form 10-IEA, you may file the form again in a later year to return to the new regime. But once you return, you cannot opt out a second time while you continue to earn business or professional income.

What happens if I miss the Form 10-IEA deadline?

The form becomes invalid and the new regime applies to you by default for that assessment year. You lose the old regime and all its deductions for that year, even if your return itself is filed on time. A late return has the same effect, since the due date has already passed.

What is the difference between Form 10-IE and Form 10-IEA?

Form 10-IE applied to AY 2021-22 through AY 2023-24 and was used to opt into the new regime when it was optional. Form 10-IEA applies from AY 2024-25 onwards and is used to opt out of the new regime, which is now the default. Only Form 10-IEA is relevant today.

Do salaried employees need to file Form 10-IEA?

No. Salaried employees, pensioners, and anyone without business or professional income choose their regime directly inside the ITR every year. No extra form, no deadline beyond the ITR itself, and no restriction on switching every year.

Official sources

• Income Tax e-filing portal — incometax.gov.in (Form 10-IEA is filed under e-File → Income Tax Forms)
• Central Board of Direct Taxes — incometaxindia.gov.in
• New regime provision: Section 202 of the Income-tax Act, 2025 (earlier Section 115BAC of the 1961 Act); return due dates: Section 263 of the 2025 Act (earlier Section 139(1))

Reviewed by Asuthod Rathod, CA.

Last updated: 12 October 2026

Disclaimer: Tax rules change often. Check incometax.gov.in or ask a qualified professional before you decide.