Big Relief for Taxpayers: Govt Extends ITR Due Dates and Revised Return Timeline

The proposed new Income Tax Act 2025 has introduced some changes in the process of filing income tax returns (ITRs) to make compliance easier for taxpayers. Section 263 of the Act mentions provisions of filing an ITR, clarifies who must file an Income Tax Return (ITR), the types of returns allowed, and the due dates. Original return, belated return, revised return, and the updated return are covered under the said section. The main aim of the amendment is to give more time to certain taxpayers so that they can properly prepare their accounts and comply with tax requirements.

Due dates of filing the income tax returns (ITRs) for different categories of taxpayers are prescribed under Section 263(1)(c) of the Act. The government has observed that taxpayers involved in business or profession, whose accounts are not required to be audited, and partners of such firms often need additional time to close their books of accounts. Trusts not requiring an audit also face similar difficulties. To reduce hardship and taxpayer complaints, the due dates for filing returns in these cases are proposed to be extended.

Similarly, for taxpayers earning income from a business or profession whose accounts are required to be audited, partners of such businesses (and their spouses, if Section 10 applies), and the due date for furnishing returns is proposed to be extended from July 31 to August 31. However, no due date extension proposal has been given for taxpayers furnishing normal returns like ITR-1 and ITR-2; the due date is the same as earlier, i.e., July 31.

Below are listed the amendments introduced to section 263(1)(c) of the Act:

The amendments introduced in the about 60-year-old Income Tax Act 1961 are scheduled to take effect from March 01, 2026, for the assessment year 2026-27 (previous year 2025-26), and those introduced in the Income Tax Act, 2025, are set to take effect from April 01, 2026, for the tax year 2026-27 and subsequent tax years.

Section 263 of the Income-tax Act, 2025, covers revised returns. Currently, taxpayers who make any mistake, omission, or wrong statement while filing their initial or belated returns are required to furnish a revised return. A revised return is required to be furnished within nine months from the end of the relevant tax year or before completion of assessment, whichever is earlier.

The government noticed that presently the time limits for filing both belated and revised returns were the same, i.e., nine months. Because of this, taxpayers were not left with time to furnish a revised return after filing a belated return. To resolve this issue, it is proposed to extend the time limit to furnish a revised return from nine months to twelve months from the end of the relevant tax year.

The action is aimed at giving taxpayers more time to correct mistakes even after filing a belated return. However, not to promote unnecessary delays, a fee has been proposed for the revised returns furnished after the time limit of nine months. This fee will be charged under Section 428(b) of the Income-tax Act, 2025.

These changes are scheduled to take effect from April 01 for the tax year 2026-27 and subsequent years. Since Section 263 of the new Act corresponds to Section 139 of the Income-tax Act, 1961, similar amendments are also proposed in Section 139(5) of the 1961 Act. A fee for delayed revised returns is also proposed under Section 234I. These amendments will come into force from March 01, 2026, and will apply from Assessment Year 2026-27 (Previous Year 2025-26).