ITR Filing For AY 2026-27: New Details Taxpayers Must Check Before Filing Returns

Return filing for assessment year 2026-27 is now opening up step by step, with the tax department releasing utilities for forms such as ITR-1, ITR-2, and ITR-4. At first, the process may not look very different from last year. However, this year’s return forms carry a few important changes that can affect how income, deductions, house property details, and certain relief claims are reported.

These changes are especially relevant for salaried taxpayers, small business owners, landlords, individuals claiming donation deductions, and those using presumptive taxation forms. While the return filing process has become more structured over the years, taxpayers will need to read each field carefully before submitting their returns, according to a recent report by Mint.

Rent And House Property Reporting Gets More Specific

One important change relates to reporting rent that could not be realised. This year, ITR-1 and ITR-4 ask landlords to separately show rent that was due but could not actually be collected from the tenant. This is relevant for taxpayers who earn rental income from house property but were unable to collect the full rent due from the tenant.

Earlier, such reporting was not as clearly captured in these simpler return forms. The new field may help landlords disclose rental income more accurately, especially where there has been default or non-payment by tenants.

There is also a useful change for taxpayers owning two house properties. Income from up to two residential properties can now be reported in the simpler forms, allowing many salaried taxpayers with two homes to avoid shifting to more complex return forms only for this reason.

This may help individuals who own one self-occupied house and another residential property, or those who have two properties with income or deemed income that needs to be reported.

Capital Gains And Foreign Retirement Relief See Changes

The capital gains section has also been simplified compared to the previous assessment year. Last year’s return forms had an extra break-up for capital gains, asking taxpayers to show whether the sale happened before or after July 23, 2024, after the Budget changed the tax treatment.

That split had created additional reporting complexity. Since the older tax rates for listed equity shares no longer apply for FY 2025-26, those separate fields have been removed from the relevant ITR forms.

Another change concerns relief under Section 89A. The relief is useful for residents who have retirement savings abroad, where the same income can sometimes get caught in the tax net in India as well as the foreign country. The option to claim this relief has now been removed from ITR-1 and ITR-4. Taxpayers who need to claim this benefit will have to use ITR-2 or ITR-3, depending on their income profile.

This means taxpayers with foreign retirement account-related relief should not choose ITR-1 or ITR-4 simply because those forms appear easier. Selecting the wrong form may lead to filing errors or the need for correction later.

Donation Claims And Bank Details Face Closer Scrutiny

Those claiming donation deductions will need to be more careful while filling out the return this time. In 80G cases, the form asks for details such as the payment reference number and the IFSC of the bank through which the donation was made.

Political donation claims will also need fuller disclosure. The taxpayer has to mention details such as the political party’s name and PAN, making it harder to claim such deductions without a clear paper trail.

Those using ITR-4 will also have to keep their bank balance and investment details ready. This form is usually chosen by small taxpayers, professionals, and businesses that report income under the presumptive tax scheme. Those using this form should keep bank statements, investment records, and year-end balances ready before filing.

Returns Filed By Representative Assessee

All ITR forms now include a field to indicate whether the return is being filed by a representative assessee. This is relevant in cases where someone else is legally filing the return on behalf of the taxpayer, such as in cases involving minors, deceased persons, incapacitated persons, or certain other representative situations.

Taxpayers should not ignore this field if the return is not being filed directly by the taxpayer concerned. Correct disclosure can help avoid mismatch or procedural issues later.

Why Taxpayers Should Be Careful This Year

The changes may not affect every taxpayer in the same way. A salaried individual with one house property and no special deductions may find the process largely routine. However, those with rental income, two house properties, capital gains, foreign retirement accounts, political donations, or presumptive income should go through the form carefully.

The larger message is clear: return filing is becoming more data-driven and disclosure-oriented. Taxpayers should not rush the process or copy last year’s return format without checking the new fields.

Before filing the return, it is useful to keep Form 16, Form 26AS, Annual Information Statement, bank statements, rent records, donation receipts, investment details, and capital gains statements ready. Choosing the correct ITR form remains just as important as entering the correct numbers.

For taxpayers, the safest approach is to review the applicable form properly, match income and deduction details with official records, and file only after ensuring that all new reporting requirements have been addressed.

FAQs

1. What are the key changes in ITR forms for AY 2026-27?

Taxpayers may need to give more specific details on unrealised rent, donation claims, bank balances, investments, capital gains, and foreign retirement account relief.

2. Can taxpayers with two house properties use simpler ITR forms?

Yes, income from up to two residential properties can now be reported in simpler forms, which may help many salaried taxpayers avoid more complex forms.

3. What should taxpayers keep ready before filing returns this year?

They should keep Form 16, Form 26AS, AIS, bank statements, rent records, donation receipts, investment details, and capital gains statements ready before filing.