Highlights
- July 31, 2026 is the deadline for salaried individuals filing ITR-1 or ITR-2 for FY2025-26 (Assessment Year 2026-27).
- ITR-3 and ITR-4 filers not requiring an audit have until August 31, 2026, while those subject to a tax audit under Section 44AB have until October 31, 2026.
- The Income-tax Act, 2025 comes into force from April 1, 2026, but since AY2026-27 covers income earned in FY2025-26, this return is still governed by the Income Tax Act, 1961.
- Missing the applicable deadline attracts a late filing fee of up to Rs 5,000 under Section 234F and forfeits the ability to carry forward losses, including capital losses, to future years.
As individual taxpayers prepare their income tax returns for the financial year that closed on March 31, 2026, this filing season carries a distinction that goes beyond the usual set of deadlines: it is set to be the last one conducted entirely under the Income Tax Act, 1961.
The Income-tax Act, 2025 has come into force from April 1, 2026, but because the assessment year 2026-27 pertains to income earned during FY2025-26, before the new law took effect, the returns being filed this season continue to be governed by the familiar 1961 framework.
Why Investors Are Watching
The filing calendar for AY2026-27 follows a tiered structure. Salaried individuals and other taxpayers filing ITR-1 or ITR-2, typically those with income from salary, up to two house properties, or interest income within specified limits, face the earliest cutoff of July 31, 2026.
Taxpayers filing ITR-3 or ITR-4 who do not require a tax audit have been given an extended window until August 31, 2026, a full month beyond the ITR-1/ITR-2 deadline. Those subject to a tax audit under Section 44AB of the Income Tax Act, 1961 have until October 31, 2026 to file their returns.
Market Context
The distinction between the 1961 Act and the 2025 Act matters primarily for future filing seasons, since income earned from April 1, 2026 onward will fall under the new law's provisions when returns for that period are eventually filed. For the current season, the interpretive framework, exemptions and computation methods applicable to FY2025-26 income remain those established under the 1961 Act.
Separately, the broader capital gains framework continues to apply for this filing season, with long-term capital gains taxable at 12.5 percent without indexation, while resident individuals and Hindu Undivided Families retain the option of a 20 percent rate with indexation specifically for land or buildings acquired before July 23, 2024 and transferred on or after that date.
What Market Participants Will Monitor
Tax practitioners and taxpayers will be watching whether the Income Tax Department extends any of the filing deadlines, as has occurred in some previous years, though no such extension has been announced for the current season as of early July 2026.
The consequences of missing the applicable deadline remain a point of attention: a late filing fee of up to Rs 5,000 applies under Section 234F, along with interest on any unpaid tax, and taxpayers who file late lose the ability to carry forward certain losses, including capital losses, to be set off against income in future years.
Industry or Peer Perspective
This transition period between the two tax laws is being closely tracked by tax professionals and compliance platforms, given that it represents a rare instance of two income tax statutes being simultaneously relevant, one governing the return being filed now and the other governing income already being earned in the current financial year.
Conclusion
As the July 31, 2026 deadline approaches for salaried taxpayers, this filing season stands as a transitional marker in India's tax administration, closing out the compliance cycle under the 1961 Act even as the new Income-tax Act, 2025 has already taken effect for income being earned in the current year. The coming months will show how smoothly this dual-framework period is navigated by taxpayers and administrators alike.
FAQs
Q: Why is the ITR filing deadline in focus today?
A: The July 31, 2026 deadline for ITR-1 and ITR-2 filers marks the last income tax filing season conducted entirely under the Income Tax Act, 1961, since the new Income-tax Act, 2025 has already come into force for income earned from April 1, 2026 onward.
Q: What factors are investors monitoring?
A: Taxpayers and tax professionals are watching whether any deadline extensions are announced, and are mindful of the late filing fee under Section 234F and the loss of the ability to carry forward losses, including capital losses, if the applicable deadline is missed.
Q: Which peer companies are relevant?
A: Peer relevance is limited based on available information, as this is a regulatory tax filing matter applicable broadly to individual taxpayers rather than a specific listed company or sector.
Q: Is this article investment advice?
A: No. This article is intended solely for informational purposes and should not be considered investment, financial or trading advice.