Income Tax Forms ITR-1 and ITR-4 Expanded to Allow Reporting of Up to Two Residential Properties.

Income-Tax Return Filing Season Kicks Off for Assessment Year 2026–27

The government has initiated the income-tax return (ITR) filing season for the Assessment Year (AY) 2026–27 by notifying all seven forms, along with the verification and updated return formats. Individuals, pensioners, professionals, and small business taxpayers can now begin filing returns using the applicable forms. The due date for non-audit cases is July 31.

A key change this year brings relief for both salaried individuals and small taxpayers opting for presumptive taxation. The simplified ITR-1 (Sahaj) and ITR-4 (Sugam) forms can now be used to report income from up to two house properties. Earlier, taxpayers with more than one property had to shift to forms such as ITR-2 or ITR-3.

Taxpayers earning income from business or profession will continue to use ITR-3 and ITR-4, based on whether they opt for the regular taxation system or the presumptive scheme. ITR-5, ITR-6, and ITR-7 are intended for entities such as firms, LLPs, companies, trusts, political parties, and other institutions, each subject to distinct filing norms.

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Changes in ITR Form 1

A significant update is the inclusion of long-term capital gains (LTCG) under Section 112A, up to Rs 1.25 lakh from listed equity shares or equity-oriented mutual funds, within the scope of this simplified form.

Another change is that reporting of income from retirement benefit accounts maintained in notified and non-notified foreign countries under Section 89A has been removed from ITR-1 starting AY 2026–27. Taxpayers having such income will now be required to file ITR-2 or ITR-3 from AY 2026–27 onwards.

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Taxpayers claiming deductions under Section 80GGC must now disclose the name and PAN of the political party to which the contribution is made. This move aims to improve transparency and ensure accurate reporting of political donations.

The revised forms ITR-V and ITR-U continue to support return verification and corrections. Notably, ITR-U enables taxpayers to update their returns within 48 months from the end of the relevant assessment year, subject to payment of any additional tax liability.