ITR Filing AY 2026-27: 7 Major Changes Every Taxpayer Must Know

The Income Tax Department has started the online filing of ITR-1, ITR-2 and ITR-4 for the assessment year 2026-27. Though the process of filing a return may look similar to previous years, there are several major changes in the forms and reporting requirements which can impact salaried employees, property owners, investors and taxpayers claiming deductions.

1. A new field has been added in ITR-1 and ITR-4 for “rent which cannot be realised”. This update is important for landlords, as earlier there was no separate section in the tax return forms to disclose such unrealised rental income.

2. Taxpayers owning up to two residential properties can now disclose both properties in simpler ITR forms such as ITR-1 and ITR-4. Earlier, many taxpayers had to use more complex ITR forms if they owned multiple house properties.

3. Due to the changes announced in the budget last year, taxpayers had to report capital gains earned before and after July 23, 2024 separately. As those old tax rules are no longer applicable for FY 2025-26, the additional reporting fields have been removed from the latest ITR forms.

4. For AY 2026-27, taxpayers filing ITR-4 will now have to provide details of their bank balances and investments. This change increases the financial information that needs to be disclosed even in the simplified tax return form.

5. Taxpayers claiming relief under Section 89A for income from foreign retirement accounts can no longer use ITR-1 or ITR-4 as they will now have to file ITR-2 or ITR-3 to claim this benefit.

6. Taxpayers claiming deductions under Section 80G will now have to provide extra details, including the transaction reference number and bank IFSC code. Those claiming deductions for donations to political parties must also disclose the party’s name and PAN in their ITR.

7. All ITR forms now have a new field to indicate whether the return is being filed by a representative assessee on behalf of another taxpayer. This helps clearly identify returns filed by authorised representatives.