ITR AY 2026-27: Complete Income Tax Compliance Calendar Every Taxpayer Should Follow

itr

ITR AY 2026-27: Complete Income Tax Compliance Calendar Every Taxpayer Should Follow

itr

As the income tax filing season gathers momentum, taxpayers must keep a close watch on several important statutory deadlines throughout the financial year. Whether you are a salaried employee, self-employed professional, business owner, or tax deductor, meeting these due dates is essential to remain compliant with the Income Tax Act, 2025.

Failure to comply with prescribed timelines can result in interest, late filing fees, and unnecessary tax disputes. Planning your tax obligations well in advance can help you avoid last-minute complications and ensure seamless compliance.

1. Advance Tax Instalment Due Dates

Taxpayers whose estimated tax liability requires payment of advance tax must ensure timely payment in four instalments during the financial year.

Advance Tax Schedule

  • 15 June
  • 15 September
  • 15 December
  • 15 March

Missing or delaying any instalment may attract interest under the Income Tax Act, 2025.

Interest under Section 424

Interest may be levied when the total advance tax paid is less than 90% of the assessed tax. The interest is calculated at 1% per month or part of a month on the outstanding amount until the liability is discharged.

Interest under Section 425

Where taxpayers fail to pay the prescribed instalments or pay a lower amount than required on each due date, interest for deferment of advance tax may also become applicable at 1% per month for the prescribed period.

These provisions broadly correspond to Sections 234B and 234C of the Income-tax Act, 1961.

2. 31 July 2026 – Due Date for Filing ITR by Non-Audit Taxpayers

For most salaried individuals, pensioners, and other taxpayers who are not required to get their accounts audited, the due date for filing the Income Tax Return (ITR) for Assessment Year 2026-27 is 31 July 2026.

Filing the return before the due date offers several benefits, including:

  • Avoidance of late filing fees
  • Timely processing of refunds
  • Reduced interest liability on unpaid taxes
  • Eligibility to carry forward eligible losses wherever permitted

Missing this deadline may lead to additional compliance costs and restrictions under the Act.

3. 31 August 2026 – Due Date for Certain Business and Professional Taxpayers

Certain taxpayers having business or professional income and filing ITR-3 or ITR-4, who are not subject to tax audit, may have a filing due date of 31 August 2026.

Since the applicable due date depends upon the nature of income and statutory requirements, taxpayers should carefully determine the correct filing deadline applicable to their case.

4. 30 September 2026 & 31 October 2026 – Tax Audit and Return Filing

Taxpayers whose accounts are required to be audited under the Income Tax Act should complete the audit process well before the filing deadline.

Generally:

  • 30 September 2026 – Due date for furnishing the Tax Audit Report.
  • 31 October 2026 – Due date for filing the Income Tax Return for audit cases.

Before filing the return, taxpayers should reconcile:

  • Books of account
  • Form 26AS
  • Annual Information Statement (AIS)
  • Taxpayer Information Summary (TIS)
  • Tax Audit Report
  • TDS and TCS credits

Proper reconciliation helps minimize notices and processing delays.

5. 31 December 2026 – Last Date for Filing a Belated Return

If a taxpayer misses the original due date for filing the Income Tax Return, a Belated Return may generally be filed up to 31 December 2026, subject to the provisions of the Income Tax Act, 2025.

Although this facility provides an additional opportunity to comply, taxpayers may still be liable for:

  • Late filing fees
  • Interest on outstanding tax
  • Certain restrictions under the Act

Therefore, filing within the original due date remains the preferred option.

6. 31 March 2027 – Final Date to File a Revised Return

A significant relief under the Income Tax Act, 2025 is the extension of the time limit for filing a Revised Return.

For Assessment Year 2026-27, taxpayers may revise an already filed return up to 31 March 2027, which marks the end of the relevant assessment year.

This extended timeline enables taxpayers to:

  • Correct reporting errors
  • Declare omitted income
  • Rectify incorrect claims
  • Update tax computations
  • Improve overall tax compliance

However, taxpayers should avoid unnecessary delays and revise the return promptly after identifying any mistakes.

Read More: Complete Guide to Salary Tax Benefits for AY 2026-27: Exemptions, Deductions & Perquisites Explained

Conclusion

Income tax compliance is not limited to filing the Income Tax Return alone. Taxpayers should monitor the entire compliance calendar, including advance tax payments, audit reporting, and return filing deadlines.

Maintaining proper books of account, reconciling tax records in advance, and filing returns within the prescribed timelines can significantly reduce compliance risks while avoiding interest, penalties, and unnecessary litigation.

A proactive approach towards these important dates will ensure smooth tax compliance throughout Assessment Year 2026-27.

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Complete Guide to Salary Tax Benefits for AY 2026-27: Exemptions, Deductions & Perquisites Explained

  • 02 Jul 2026
  • ITR
  • Comments Off on Complete Guide to Salary Tax Benefits for AY 2026-27: Exemptions, Deductions & Perquisites Explained
Salary

Complete Guide to Salary Tax Benefits for AY 2026-27: Exemptions, Deductions & Perquisites Explained

Salary

Tax planning is an essential aspect of financial management for every salaried individual. While salary forms the primary source of income for millions of taxpayers, not every component of a salary package is fully taxable. The Income-tax Act, 1961 provides several exemptions, deductions, and tax-efficient benefits that can significantly reduce an employee’s taxable income when claimed correctly.

With the amendments introduced by the Finance Act, 2026, taxpayers must understand the latest provisions applicable for Assessment Year (AY) 2026-27. From House Rent Allowance (HRA) and Leave Travel Concession (LTC) to retirement benefits and employer-provided perquisites, every component of a salary package has its own tax implications.

This guide provides a comprehensive overview of salary taxation and serves as a ready reckoner for salaried employees, employers, payroll professionals, HR managers, and tax practitioners.

What Constitutes Salary Income?

Under the Income-tax Act, salary income includes much more than monthly basic pay. It generally comprises:

  • Basic Salary
  • Dearness Allowance (DA)
  • Bonus and Commission
  • Allowances
  • Perquisites
  • Employer’s Contributions to Retirement Funds
  • Pension
  • Advance Salary
  • Arrears of Salary
  • Leave Encashment
  • Gratuity
  • Profits in lieu of Salary

Understanding each component is the first step towards effective tax planning.

Tax-Exempt Allowances Available to Salaried Employees

Certain allowances are either fully exempt or partially exempt subject to prescribed conditions.

Some of the major exemptions include:

1. House Rent Allowance (HRA)

Employees living in rented accommodation may claim exemption under Section 10(13A), subject to prescribed limits based on salary, rent paid and city of residence.

Salary

2. Children's Education Allowance

Exemption is available for education allowance received for children, subject to the prescribed monetary limits.

3. Hostel Expenditure Allowance

Employees receiving hostel expenditure allowance for children can claim exemption within specified limits.

4. Conveyance and Travel Allowances

Several reimbursements granted exclusively for official duties remain exempt to the extent of actual expenditure incurred, including:

  • Conveyance Allowance
  • Tour and Transfer Allowance
  • Daily Allowance
  • Helper Allowance
  • Research Allowance
  • Uniform Allowance

5. Special Compensatory Allowances

The Act also provides exemptions for employees working in:

  • Hilly Areas
  • Border Areas
  • Remote Locations
  • Tribal Areas
  • High Altitude Regions
  • Underground Mines
  • Armed Forces Field Areas
  • Island Duty Locations

The exemption limits vary depending upon the nature of employment and location.

Understanding Taxable Perquisites

Apart from salary, employees often receive various non-cash benefits from employers known as Perquisites.

These benefits may be fully taxable, partially taxable or exempt depending upon the applicable valuation rules.

Major perquisites include:

  • Rent-Free Accommodation
  • Furnished Accommodation
  • Hotel Accommodation
  • Motor Car Facility
  • Domestic Servants
  • Electricity, Gas and Water
  • Education Facilities
  • Interest-Free Loans
  • Credit Card Facilities
  • Club Membership
  • Gifts and Vouchers
  • Mobile Phone and Telephone Facilities
  • Employer-paid Taxes
  • Free Food and Beverages
  • Employer Contributions to Retirement Funds

Proper valuation of these benefits is crucial while computing taxable salary.

Employer Contributions to Retirement Funds

The taxability of employer contributions has become increasingly important in recent years.

The guide explains taxation relating to:

  • Recognised Provident Fund (RPF)
  • Statutory Provident Fund (SPF)
  • Public Provident Fund (PPF)
  • Unrecognised Provident Fund (URPF)
  • Approved Superannuation Fund
  • National Pension System (NPS)

It also discusses taxation of annual accretions, interest income and employer contributions exceeding the prescribed threshold.

Leave Travel Concession (LTC/LTA)

Employees can claim exemption for Leave Travel Concession subject to conditions regarding:

  • Number of journeys
  • Block period
  • Eligible family members
  • Mode of travel
  • Maximum exemption available

Only travel expenses qualify for exemption, while boarding and lodging expenses remain taxable.

Medical Benefits and Health-Related Exemptions

Medical benefits provided by employers continue to enjoy exemptions in specified cases.

These include:

  • Treatment in Government and approved hospitals
  • Employer-paid medical insurance premiums
  • Medical treatment outside India
  • COVID-19 treatment reimbursements
  • Medical facilities provided by employers

Knowing these provisions can prevent unnecessary taxation of genuine medical benefits.

Salary Deductions Available Under the Income-tax Act

After computing gross salary, eligible deductions reduce taxable income.

Important deductions include:

Standard Deduction

Every eligible salaried taxpayer can claim the standard deduction as prescribed under the applicable tax regime.

Entertainment Allowance

Available only to Government employees subject to prescribed conditions.

Professional Tax

Professional tax actually paid during the financial year is deductible under Section 16.

Tax Benefits on Retirement

Retirement benefits receive special treatment under the Income-tax Act.

The guide explains exemptions relating to:

Gratuity

Separate provisions apply for:

  • Government Employees
  • Employees covered under the Payment of Gratuity Act
  • Employees not covered under the Gratuity Act

Leave Encashment

Tax treatment differs between:

  • Government Employees
  • Other Employees

Specified exemption limits apply.

Pension

Coverage includes:

  • Commuted Pension
  • Uncommuted Pension
  • Family Pension
  • Pension received from specified organisations

Voluntary Retirement Scheme (VRS)

Employees opting for voluntary retirement may claim exemption under Section 10(10C), subject to prescribed conditions.

National Pension System (NPS)

The guide discusses taxation relating to:

  • Employer Contribution
  • Employee Contribution
  • Partial Withdrawal
  • Exit from NPS
  • Taxability of Lump Sum Withdrawal

NPS continues to remain one of the most tax-efficient retirement planning tools.

Provident Fund Taxation

The taxation of Provident Funds depends upon the type of fund involved.

The guide explains:

  • Taxability of Employer Contribution
  • Employee Contribution
  • Interest Credited
  • Withdrawal Rules
  • Taxability of Excess Contributions
  • Conditions for Tax-Free Withdrawal

Relief Under Section 89

Employees often receive:

  • Salary Arrears
  • Advance Salary
  • Pension Arrears

Such receipts may increase tax liability in one financial year.

Section 89 provides relief to reduce the additional tax burden, subject to filing the prescribed form and satisfying the applicable conditions.

Benefits Available to Special Categories of Employees

Certain employees enjoy additional exemptions, including:

  • Government Employees
  • Armed Forces Personnel
  • Employees posted outside India
  • Employees of International Organisations
  • UPSC Chairman and Members
  • Judges
  • Foreign Diplomats
  • Teachers from SAARC Countries
  • Employees working in notified remote locations

Why Understanding Salary Taxation Is Important

Incorrect reporting of salary components can result in:

  • Higher tax liability
  • Incorrect TDS deductions
  • Notices from the Income-tax Department
  • Loss of legitimate exemptions
  • Payroll errors

Understanding the provisions enables employees to optimise tax benefits while ensuring complete compliance with the Income-tax Act.

Read More: CBDT Compulsory Income Tax Scrutiny Guidelines FY 2026-27: Understanding CS-01 to CS-06 and When Your ITR Can Be Selected

Conclusion

Salary taxation extends far beyond monthly pay. Every allowance, reimbursement, retirement benefit, and employer-provided facility has a specific tax treatment under the Income-tax Act, 1961. A thorough understanding of these provisions enables taxpayers to make informed financial decisions, maximise eligible exemptions and deductions, and file accurate Income Tax Returns.

Whether you are a salaried employee planning your taxes, an HR professional administering payroll, or a tax consultant advising clients, keeping abreast of the latest provisions applicable for Assessment Year 2026-27 is essential. Proper tax planning not only reduces tax liability but also ensures smooth compliance with the law.

Disclaimer: This guide is based on the provisions of the Income-tax Act, 1961, as amended by the Finance Act, 2026, applicable for Assessment Year 2026-27. Taxability may vary depending on individual circumstances and subsequent legislative amendments. Readers are advised to seek professional advice before making tax-related decisions.

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11 Situations Where Filing an Income Tax Return (ITR) Is Mandatory for AY 2026-27

  • 28 Jun 2026
  • ITR
  • Comments Off on 11 Situations Where Filing an Income Tax Return (ITR) Is Mandatory for AY 2026-27
ITR

11 Situations Where Filing an Income Tax Return (ITR) Is Mandatory for AY 2026-27

ITR

Don't Assume Low Income Means You Can Skip Filing Your ITR

Many taxpayers believe that filing an Income Tax Return (ITR) is necessary only when their income exceeds the basic exemption limit. While this is the most common reason for filing, the Income-tax Act prescribes several other situations where filing an ITR becomes mandatory, even if your taxable income is below the exemption threshold.

Whether you are a salaried employee, business owner, professional, investor, or an NRI with financial interests in India, understanding these mandatory filing provisions can help you avoid penalties and remain compliant.

As the filing season for Assessment Year (AY) 2026-27 begins, here are the 11 key situations in which filing an ITR is compulsory.

1. Your Total Income Exceeds the Basic Exemption Limit

If your total income before claiming deductions under Chapter VI-A (such as Section 80C, 80D, etc.) exceeds the applicable basic exemption limit, filing an ITR is mandatory.

Basic Exemption Limits

CategoryOld Tax RegimeNew Tax Regime
Individuals below 60 years₹2,50,000₹4,00,000
Senior Citizens (60 to below 80 years)₹3,00,000₹4,00,000
Super Senior Citizens (80 years & above)₹5,00,000₹4,00,000

2. Every Company, Partnership Firm, or LLP Must File an ITR

Every registered:

  • Company
  • Partnership Firm
  • Limited Liability Partnership (LLP)

must file an Income Tax Return irrespective of whether:

  • it earned profits,
  • incurred losses, or
  • remained inactive throughout the financial year.

3. You Own Foreign Assets or Have Financial Interests Outside India

A resident individual must file an ITR if they:

  • Own any asset located outside India.
  • Hold a foreign bank account.
  • Have signing authority in a foreign account.
  • Are a beneficiary of a foreign trust or asset.
  • Possess any financial interest outside India.

This requirement applies even if no income is earned from those assets.

4. Your Foreign Travel Expenses Exceed ₹2 Lakh

ITR filing becomes mandatory if you incur foreign travel expenditure of ₹2 lakh or more during the financial year, whether the expense is for:

  • yourself, or
  • any other person.

5. Deposits in Current Accounts Exceed ₹1 Crore

You are required to file an ITR if the aggregate amount deposited in one or more current accounts maintained with a bank or cooperative bank exceeds ₹1 crore during the financial year.

6. Savings Bank Deposits Reach ₹50 Lakh or More

Individuals whose total deposits in one or more savings bank accounts amount to ₹50 lakh or more during the financial year are required to furnish an Income Tax Return.

7. Electricity Bills Exceed ₹1 Lakh

If your electricity expenditure during the financial year exceeds ₹1 lakh, filing an ITR becomes mandatory, irrespective of your taxable income.

8. Business or Professional Receipts Cross the Prescribed Limits

ITR filing is compulsory where:

Business

  • Total sales, turnover, or gross receipts exceed ₹60 lakh.

Profession

  • Gross professional receipts exceed ₹10 lakh.

9. TDS or TCS Exceeds the Specified Threshold

You must file an ITR if the total:

  • Tax Deducted at Source (TDS), or
  • Tax Collected at Source (TCS)

during the financial year exceeds:

  • ₹25,000 for most taxpayers.
  • ₹50,000 for senior citizens (60 years or above).

10. You Want to Claim a Tax Refund

If excess tax has been paid through:

  • TDS,
  • TCS,
  • Advance Tax, or
  • Self-Assessment Tax,

filing an ITR is necessary to claim the refund from the Income Tax Department.

Without filing the return, the refund cannot be processed.

11. You Want to Carry Forward Eligible Losses

Taxpayers who incur losses under eligible heads such as:

  • Business or Profession,
  • Capital Gains, or
  • House Property,

should file their ITR within the prescribed due date if they wish to carry those losses forward and set them off against future income.

Missing the due date may result in losing this tax benefit.

Quick Summary: When Is ITR Filing Mandatory?

SituationThreshold
Total income exceeds exemption limitApplicable basic exemption limit
Company, Partnership Firm or LLPMandatory irrespective of income
Foreign assets or financial interest abroadAny amount
Foreign travel expenditureAbove ₹2 lakh
Current account depositsAbove ₹1 crore
Savings account deposits₹50 lakh or more
Electricity expenditureAbove ₹1 lakh
Business turnoverAbove ₹60 lakh
Professional receiptsAbove ₹10 lakh
TDS/TCS during the year₹25,000 (₹50,000 for senior citizens)
Claiming tax refundAny amount
Carry forward of eligible lossesReturn must be filed within the due date

Read More: ESOP Buybacks in Unlisted Companies: Why Employees Often Face Taxation Twice

Conclusion

Filing an Income Tax Return is more than just a tax payment exercise—it is an important legal compliance requirement. Even if your income is below the taxable limit, specific financial transactions, ownership of foreign assets, business activities, or the desire to claim refunds and carry forward losses can make ITR filing mandatory.

Before deciding not to file your return for AY 2026-27, review these conditions carefully. Filing your ITR on time not only ensures compliance but also helps you avoid penalties, preserve tax benefits, and maintain a clean financial record.

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