5 important ITR updates taxpayers must know for FY27
What's the story
The Income Tax Act, 2025 and Income Tax Rules, 2026 apply for all taxpayers from April 1, 2026. The new regulations come with some major changes that you need to be aware of. These changes will apply to the tax year 2026-27, which is different from Assessment Year (AY) 2026-27. For AY 2026-27, income tax returns (ITRs) must be filed by July 31 this year as per the provisions of the Income Tax Act,1961 and Income Tax Rules,1962.
Deadline extension
Changes in ITR filing process
The Finance Bill, 2026 has proposed some major changes to the ITR filing process. The deadline for filing ITRs has been extended from July 31 to August 31 for non-audit business/professional taxpayers and partners of non-audit firms. However, the due date remains unchanged at July 31 for non-business assesses. Taxpayers can now file an updated return even after receiving a reassessment notice within the time prescribed in that notice on payment of tax, interest, and an additional 10%.
Filing extension
Revised returns can now be filed up to 12 months
The time limit to file a revised return has been extended from nine months to 12 months from the end of the relevant year or before assessment. However, if filed after nine months, a fee of ₹1,000 for income up to ₹5 lakh or ₹5,000 for other cases will be applicable. The Central Board of Direct Taxes (CBDT) can now mandate quoting of Permanent Account Number (PAN) even for non-business/non-professional transactions under Section 262(10)(c).
Return updates
Other key changes under new regulations
The Finance Bill 2026 also allows an updated return even if the original was a loss return, as long as it reduces the loss amount. This change facilitates voluntary correction. Several popular income tax forms have been renumbered under these new regulations. Form 15G/15H has been unified into Form 121 while other forms like Form 16 is now known as Form 130 and Tax audit forms (3CA,3CB and 3CD) are now made into a single Form 26.