Big Announcement Regarding ITR in the Budget, What Has Changed for Taxpayers?

Budget 2026 ITR: Union Finance Minister Nirmala Sitharaman is presenting the Union Budget in Parliament. During her budget speech, she made several important announcements that will directly impact ordinary taxpayers. One of these major announcements is related to Income Tax Returns (ITR). Following this announcement, salaried individuals and middle-class taxpayers are expected to receive relief in several areas.

What was announced regarding ITR filing?

The Finance Minister stated that taxpayers filing ITR-1 and ITR-2 will now be able to file their returns easily within the stipulated deadline. The last date for filing returns for both these categories remains July 31st. A significant update was also provided regarding the implementation of the new Income Tax Act.

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When will the new Income Tax Act be implemented?

The most important change is that the new Income Tax Act will be implemented from April 1, 2026. This new law will replace the existing Income Tax Act of 1961, which is now considered outdated and complex. The government aims to make the tax system simpler and easier to understand. The new rules and forms will be notified soon to give taxpayers ample time to prepare.

Relief regarding Revised ITR

The budget also announced that the last date for filing revised ITRs has been extended to March 31st. However, taxpayers will have to pay a nominal additional fee for this. This will benefit those who had inadvertently failed to report their income correctly.

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What else has changed in the new income tax rules?

The Finance Minister also announced that the TCS (Tax Collected at Source) on overseas tour packages has been reduced to 2 percent, from the previous 5 to 20 percent. Additionally, TDS (Tax Deducted at Source) will now be applicable on the sale of property in India by non-residents. A 6-month foreign asset disclosure scheme has also been announced for small taxpayers, allowing them to disclose their foreign assets without fear. The government will soon notify simplified income tax rules.