Jigar M. Patel
International Tax Attorney
One Month’s Added Time for Simple Business Returns
The Finance Bill has proposed to move away from the earlier uniform deadline for filing tax returns in all non-audit cases, including salaried, investors and business entities. Accordingly, while the due date of July 31 will continue for non-business cases, business entities, not governed by audit or tax audit, will be required to file their ITRs by August 31, with effect from the ensuing assessment year 2026-27, under the old Income-tax Act, 1961 and starting from tax year 2026-27 as per the new Income-tax Act, 2025.
Timeline for Revised Returns extended by Three Months
A welcome change in the provisions relating to filing of ITRs, as proposed by the Finance Bill 2026, is granting taxpayers three months additional time to file a revised return in appropriate cases. It was felt that the current deadline of December was not sufficient to allow taxpayers to review any corrections required in the original ITR filed by them. The prescribed time limit for filing of revised returns has accordingly been extended to March 31, being the end of the assessment year.
Comfort granted with Levy of Fee under New Section 234I
While taxpayers will now enjoy the comfort of the three months extended window, there will be a price attached with the same. A new section 234I has been introduced with effect from 1st March, 2026. The said section provides that any revised return, filed after December 31, until the end of the year being March 31, will attract a fee of Rs. 1,000 if the returned income does not exceed Rs. 5 lakhs and Rs. 5,000 in all other cases.
Fee for Belated Return to separately Continue
It needs to be noted that the current provisions of section 234F prescribing levy of fee of Rs. 1,000 or Rs. 5,000 (depending on the returned income being less or more than Rs. 5 lakhs) in case of a belated return being filed beyond the due date prescribed under section 139(1) will continue.
Keeping in view the provisions of section 234F and 234I as referred above, a taxpayer may now be required to bear the impact of fees, both for a belated ITR, as well as a revised return beyond December.
The Chart below will explain this point.
| Filing of ITR | Fee u/s. 234F | Fee u/s. 234I | Total Fee Payable |
| Original ITR in time and Revised ITR before Dec. 31 | Nil | Nil | Nil |
| Original ITR in time and Revised ITR after Dec. 31 | Nil | 1,000 / 5,000 | 1,000 / 5,000 |
| Original ITR belated, but Revised ITR before Dec. 31 | 1,000 / 5,000 | Nil | 1,000 / 5,000 |
| Original ITR belated and Revised ITR after Dec. 31 | 1,000 / 5,000 | 1,000 / 5,000 | 2,000 / 10,000 |
Welcome Amendments in relation to Updated Returns
For encouraging greater voluntary compliance, the Finance Bill has proposed two amendments under section 139(8A) enlarging the scope for filing of updated returns. Taxpayers will now be permitted to file an updated ITR, even in a case where reassessment notice has been issued. However, this will be subject to an added tax levy of 10%, over and above the prescribed rates of 25%, 50%, 60% and 70% as applicable based on the time period of delay, from the expiry of the prescribed time limit of ITR filing.
Currently, filing of updated return is not permitted in a where the original return has declared a loss. Under the relaxed provision introduced with effect from 1st March, 2026, even in such a case an updated return will be allowed, if the same is filed reducing the amount of loss originally returned.
