Govt. Advise Taxpayers to Correct Ineligible Deductions by December 31

The Central Board of Direct Taxes (CBDT) under the Government of India recently issued a press release on December 23, 2025 regarding an initiative to encourage taxpayers to voluntarily review deduction or exemption claims identified as potentially ineligible through risk analytics.

CBDT observed that some taxpayers have wrongly claimed tax refunds by showing deductions or exemptions that they were not actually eligible for.

The government has requested taxpayers through SMS and email alerts to check their Income Tax Returns (ITRs) and correct any mistakes before the last date of December 31, 2025 under NUDGE campaign, the tax department is politely reminding people to review their returns and voluntarily fix any wrong or ineligible claims. This makes the tax system transparent, friendly, and non-intrusive, encouraging people to follow the rules willingly rather than through penalties or notices.

During the financial year 2025-26, 21 lakh taxpayers have already filed their income tax returns for the assessment years 2021-22 to 2024-25, collectively paying more than Rs 2,500 crore in taxes. Additionally, more than 15 lakh taxpayers have revised their returns for the current assessment year.

Government advised taxpayers to verify their income tax returns (ITRs) to ensure that their claims for deductions and exemptions are correct. And directed that if they find any mistakes, they should revise their returns before December 31, 2025 to avoid any future scrutiny or action.

If taxpayers deductions and exemptions are already correct, they don’t need to do anything. Even if taxpayers miss this due-date, they can still update their returns from January 1, 2026, However this attract additional tax fee.