Income tax return filing begins for FY26 as taxpayers get key compliance checklist

21 June, 2026
Income tax return filing begins for FY26 as taxpayers get key compliance checklist

Winning Bizness Desk

Mumbai.The Income Tax Return (ITR) filing process for financial year 2025-26 has begun, and taxpayers are being advised to complete the exercise carefully before the deadline to avoid notices, penalties and interest liabilities. For most individual taxpayers, the last date to file returns is July 31, 2026, while certain business taxpayers filing under ITR-3 and ITR-4 categories have time until August 31. Tax experts say that with the Income Tax Department increasingly relying on artificial intelligence, data analytics and digital tracking tools, even small errors in returns can attract scrutiny.

Missing the July 31 deadline does not completely close the filing window. Taxpayers can still submit a belated return by December 31 after paying the applicable penalty. An ITR serves as an official record of an individual's income, investments and financial transactions during a financial year. As tax authorities cross-check information from multiple sources, accurate disclosure has become more important than ever.

Checking income records before filing

According to tax expert and chartered accountant Anand Jain of Indore, taxpayers should not rely solely on Form 16 while preparing their returns. Form 16 contains details of salary income and tax deducted at source (TDS), but several other income streams may also be taxable.

Key income sources often missed include:

  • Interest earned from fixed deposits and recurring deposits
  • Savings account interest and bond income
  • Dividend receipts from investments
  • Rental earnings from property
  • Freelance or professional income
  • Gains from shares and mutual funds
  • Foreign income, if applicable

Failure to disclose such income can result in additional tax demand and interest at a later stage.

Selecting the appropriate return form is equally critical. Filing under the wrong form may result in the return being treated as defective, effectively making it invalid.

The commonly used forms include:

  • ITR-1:For salary earners, pensioners and those with simple interest income

  • ITR-2:For taxpayers with capital gains, multiple house properties, foreign assets or foreign income

  • ITR-3:For business owners, freelancers, traders and F&O participants

  • ITR-4:For small businesses and professionals under presumptive taxation

Tax professionals recommend reviewing eligibility conditions carefully before filing to avoid complications later.

Match all tax statements carefully

Before submitting returns, taxpayers should reconcile Form 16 with Form 26AS, the Annual Information Statement (AIS) and the Taxpayer Information Summary (TIS). Any mismatch between reported income and departmental records may trigger a query from the tax department.

Quick checks before filing:

  • Verify salary and TDS figures
  • Cross-check interest income entries
  • Review capital market transactions
  • Confirm high-value financial transactions
  • Report discrepancies through the tax portal

Experts note that AIS and TIS now capture a wide range of financial activities, making accurate reporting essential.

Job changes and banking details matter

Individuals who changed jobs during the financial year should combine salary received from both employers before filing returns. Ignoring income from a previous employer can lead to lower tax deduction and additional tax liability later.

Taxpayers should also provide complete details of all bank accounts held during the year. Particular attention should be paid to the account selected for refunds. Incorrect account numbers or IFSC codes can delay the refund process significantly.

Declare investments and complete verification

The Income Tax Department receives extensive information linked to PAN, including share transactions, mutual fund redemptions and property sales. Taxpayers must report both gains and losses from such transactions. Declaring losses can help reduce future tax liability through set-off provisions.

Additional points taxpayers should remember:

  • Claim deductions under Sections 80C, 80D and NPS only with valid documentation
  • Disclose foreign shares, ETFs, bank accounts and overseas investments wherever applicable
  • Maintain supporting records for all deduction claims
  • Complete e-verification after filing through Aadhaar OTP, net banking, demit account or digital signature

Experts stress that filing the return alone is not sufficient. Unless e-verification is completed within the prescribed timeline, the return may be treated as invalid. With technology-driven scrutiny becoming sharper every year, taxpayers are being advised to file early, verify disclosures thoroughly and ensure every source of income is accurately reported.