ITR filing this year? 5 changes that make it different from last year
Planning to file your ITR soon? Before you begin, it may be worth slowing down for a moment. From new disclosure requirements to tweaks in reporting rules, tax return filing this year comes with a few important changes that many taxpayers may easily miss. Here are five key updates to know.
If filing income tax returns feels like an annual ritual that comes with a little confusion, you are not alone. Like every year, the Income Tax Department has opened online filing and released Excel utilities for ITR-1 and ITR-4, allowing many taxpayers to begin the process even before receiving Form 16 from employers, which usually arrives by mid-June.
But this year’s tax filing season comes with a few important twists. While the filing process may look familiar at first glance, several changes in forms and reporting rules mean taxpayers may need to be more careful than before. From new disclosure requirements to changes in capital gains reporting, filing your return for Assessment Year (AY) 2026–27 may not be exactly the same as last year.
Adding to this, this will be the final return filing cycle under the old Income Tax Act, 1961, even though the new Income Tax Act, 2025 has already been introduced. Since taxes for FY 2025–26 will still be assessed under the older law, taxpayers should pay close attention while filing returns.
Here are five major changes that could affect how you file your ITR this year.
REPORTING INCOME FROM TWO HOUSE PROPERTIES
One major relief this year is for taxpayers who own more than one house property.
Earlier, salaried individuals filing ITR-1 (Sahaj) and small business taxpayers using ITR-4 (Sugam) had limited reporting flexibility. Now, taxpayers can disclose income from up to two residential properties while using these forms.
This means individuals earning salary income and also owning two houses can continue using simpler ITR forms instead of shifting to more complex ones.
NO MORE OLD CAPITAL GAINS TAX CATEGORIES
If capital gains reporting confused you last year, things may become simpler now.
In AY 2025–26, taxpayers had to separately report gains depending on whether transactions happened before or after July 23, 2024, due to changes announced in the Budget. Different tax rates applied to short-term and long-term gains during different periods.
For AY 2026–27, those older reporting fields have been removed. Since FY 2025–26 follows a single capital gains tax structure, taxpayers will no longer have to split transactions based on dates in the same way.
In simple words, capital gains reporting is expected to be less complicated this year.
NEW DISCLOSURE FOR UNREALISED RENT
Another change that may catch landlords’ attention is a new disclosure requirement related to rent that could not be recovered.
The Income Tax Department has added a separate field called “The amount of rent which cannot be realised” in ITR forms, including ITR-1 and ITR-4.
Previously, taxpayers filing these forms did not have a separate place to report unrealised rent. The addition aims to make rental income disclosures more detailed and transparent.
BANK BALANCE REPORTING NOW MANDATORY
For taxpayers filing ITR-4 under presumptive taxation schemes, an extra disclosure has become compulsory.
Individuals covered under Sections 44AD, 44ADA and 44AE will now have to report the total closing balance of all active bank accounts as of March 31, 2026.
This information needs to be disclosed in field E21 of ITR-4. Tax experts warn that incorrect reporting or failure to disclose balances could invite tax notices or penalties.
CHOOSING THE RIGHT ITR FORM MATTERS MORE THAN BEFORE
Picking the correct ITR form has always been important, but this year it has become even more crucial.
Taxpayers with multiple income streams, such as salary, rental income, capital gains, freelance earnings, trading activity or business income, may need to carefully assess which form applies to them.
Filing the wrong form could lead to defective return notices, delayed refunds, incorrect tax calculations or even loss of certain tax benefits, such as carrying forward losses.
What Taxpayers Should Do Before Filing
Even though online filing has already begun, many salaried employees are still waiting for Form 16. Experts suggest using this time to gather important documents, review bank statements, check investment proofs and understand which ITR form applies to your income.
This year’s changes may not completely overhaul tax filing, but they do make one thing clear: a little extra attention while filing could save taxpayers from unnecessary trouble later.
If filing income tax returns feels like an annual ritual that comes with a little confusion, you are not alone. Like every year, the Income Tax Department has opened online filing and released Excel utilities for ITR-1 and ITR-4, allowing many taxpayers to begin the process even before receiving Form 16 from employers, which usually arrives by mid-June.
But this year’s tax filing season comes with a few important twists. While the filing process may look familiar at first glance, several changes in forms and reporting rules mean taxpayers may need to be more careful than before. From new disclosure requirements to changes in capital gains reporting, filing your return for Assessment Year (AY) 2026–27 may not be exactly the same as last year.
Adding to this, this will be the final return filing cycle under the old Income Tax Act, 1961, even though the new Income Tax Act, 2025 has already been introduced. Since taxes for FY 2025–26 will still be assessed under the older law, taxpayers should pay close attention while filing returns.
Here are five major changes that could affect how you file your ITR this year.
REPORTING INCOME FROM TWO HOUSE PROPERTIES
One major relief this year is for taxpayers who own more than one house property.
Earlier, salaried individuals filing ITR-1 (Sahaj) and small business taxpayers using ITR-4 (Sugam) had limited reporting flexibility. Now, taxpayers can disclose income from up to two residential properties while using these forms.
This means individuals earning salary income and also owning two houses can continue using simpler ITR forms instead of shifting to more complex ones.
NO MORE OLD CAPITAL GAINS TAX CATEGORIES
If capital gains reporting confused you last year, things may become simpler now.
In AY 2025–26, taxpayers had to separately report gains depending on whether transactions happened before or after July 23, 2024, due to changes announced in the Budget. Different tax rates applied to short-term and long-term gains during different periods.
For AY 2026–27, those older reporting fields have been removed. Since FY 2025–26 follows a single capital gains tax structure, taxpayers will no longer have to split transactions based on dates in the same way.
In simple words, capital gains reporting is expected to be less complicated this year.
NEW DISCLOSURE FOR UNREALISED RENT
Another change that may catch landlords’ attention is a new disclosure requirement related to rent that could not be recovered.
The Income Tax Department has added a separate field called “The amount of rent which cannot be realised” in ITR forms, including ITR-1 and ITR-4.
Previously, taxpayers filing these forms did not have a separate place to report unrealised rent. The addition aims to make rental income disclosures more detailed and transparent.
BANK BALANCE REPORTING NOW MANDATORY
For taxpayers filing ITR-4 under presumptive taxation schemes, an extra disclosure has become compulsory.
Individuals covered under Sections 44AD, 44ADA and 44AE will now have to report the total closing balance of all active bank accounts as of March 31, 2026.
This information needs to be disclosed in field E21 of ITR-4. Tax experts warn that incorrect reporting or failure to disclose balances could invite tax notices or penalties.
CHOOSING THE RIGHT ITR FORM MATTERS MORE THAN BEFORE
Picking the correct ITR form has always been important, but this year it has become even more crucial.
Taxpayers with multiple income streams, such as salary, rental income, capital gains, freelance earnings, trading activity or business income, may need to carefully assess which form applies to them.
Filing the wrong form could lead to defective return notices, delayed refunds, incorrect tax calculations or even loss of certain tax benefits, such as carrying forward losses.
What Taxpayers Should Do Before Filing
Even though online filing has already begun, many salaried employees are still waiting for Form 16. Experts suggest using this time to gather important documents, review bank statements, check investment proofs and understand which ITR form applies to your income.
This year’s changes may not completely overhaul tax filing, but they do make one thing clear: a little extra attention while filing could save taxpayers from unnecessary trouble later.
