Changes in ITR Form

ITR Forms AY 2026–27 Decoded: Major Amendments in Reporting, Presumptive Taxation, MSME Compliance, and Trust Disclosures

🙶Changes in the ITR Forms for AY 2026–27, expanding reporting requirements across business income, presumptive taxation, charitable trusts, political contributions, and MSME compliance. Key amendments include separate reporting of F&O turnover, MSME interest disallowances, concessional-rate interest income, and enhanced donor and auditor disclosures.🙷

The Central Board of Direct Taxes (CBDT) has notified Income-tax Return (ITR) Forms 1 to 7, along with ITR-V and ITR-U, for the Assessment Year (AY) 2026–27 corresponding to the Previous Year (PY) 2025–26, i.e., from 1 April 2025 to 31 March 2026.

Unlike the preceding assessment year, where delayed notification of the ITR forms postponed the release of utilities and necessitated extensions in return filing timelines, the forms for AY 2026–27 have been notified in a timely manner. The revised forms incorporate several structural and disclosure-oriented modifications aimed at improving data reconciliation, strengthening compliance monitoring, and aligning return reporting with recent legislative amendments introduced through the Finance Acts of 2025 and 2026.

Set out below is a comprehensive analysis of the significant amendments introduced in the revised ITR forms for AY 2026–27.

1. Separate Reporting of Disallowable MSME Interest

[Applicable to ITR-3, ITR-5 and ITR-6]

A new reporting field has been inserted in Part A – OI (Other Information) requiring disclosure of interest disallowed under Section 23 of the MSMED Act, 2006.

Section 43B(h) of the Income-tax Act disallows deduction of amounts payable to Micro and Small Enterprises where payment is not made within the timelines prescribed under Section 15 of the MSMED Act, namely:

  • Within the agreed credit period, not exceeding 45 days; or
  • Within 15 days where no agreement exists.

Further, delayed payment attracts compound interest under Section 16 of the MSMED Act at three times the RBI notified bank rate.

Since Section 23 specifically prohibits deduction of such interest expenditure, the revised ITR forms now require taxpayers to separately report the amount of non-deductible MSME interest.

2. Mandatory Disclosure of Political Party Name and PAN under Section 80GGC

[Applicable to ITR-1 to ITR-6]

Schedule 80GGC has been expanded to require taxpayers claiming deduction for political contributions to furnish:

  • Name of the political party; and
  • PAN of the political party.

Earlier, the schedule primarily sought contribution amount, date, payment mode, transaction reference number, and bank details.

The amendment enhances traceability and verification of political donations.

3. Mandatory Reporting of Futures & Options (F&O) Turnover and Income

[Applicable to ITR-3, ITR-5 and ITR-6]

The Schedule Part A – Trading Account applicable to taxpayers carrying on trading activities has been amended to introduce dedicated disclosure fields relating to Futures & Options (F&O) transactions.

The schedule traditionally required disclosure of trading account particulars such as:

  • Opening stock
  • Purchases
  • Direct expenses
  • Sales
  • Closing stock
  • Gross profit or gross loss

The revised forms now specifically mandate disclosure of:

  • Turnover from F&O transactions; and
  • Income from such transactions credited to the Profit & Loss Account.

This amendment appears intended to facilitate improved verification of derivative trading income and corresponding tax treatment.

4. Disclosure of Interest and Remuneration from Partnership Firms

[Applicable to ITR-3, ITR-5 and ITR-6]

Schedule IF dealing with partnership firm information has been expanded.

Taxpayers who are partners in partnership firms are now additionally required to disclose:

  • Interest due or received from the partnership firm; and
  • Remuneration due or received from the partnership firm.

This amendment strengthens information matching between firm-level and partner-level tax reporting.

5. Reporting of Fee Paid Under Section 234-I for Revised Returns

[Applicable to ITR-1 to ITR-7]

The Finance Act, 2026 has extended the time limit for filing revised returns from 9 months to 12 months from the end of the relevant assessment year, or completion of assessment, whichever is earlier.

However, filing a revised return during the extended period is subject to payment of an additional fee under Section 234-I:

  • Rs. 1,000 where total income does not exceed Rs. 5 lakh; and
  • Rs. 5,000 in other cases.

Consequently, the revised ITR forms now contain a separate reporting field for disclosure of fees paid under Section 234-I.

6. Additional Banking Details in Schedule 80G

[Applicable to ITR-1 to ITR-6]

Schedule 80G has been amended to require additional banking particulars for donations claimed as deductions.

Taxpayers must now furnish:

  • Transaction reference number for UPI/IMPS/NEFT/RTGS or cheque reference number; and
  • IFSC code of the remitting bank.

This amendment strengthens donation audit trails and digital verification.

7. Incorporation of Revised Due Date of 31 August

[Applicable to ITR-3]

Pursuant to the Finance Act, 2026, the due date for filing returns by:

  • Non-audit business/professional taxpayers; and
  • Partners of non-audit firms

has been extended from 31 July to 31 August.

The revised ITR-3 accordingly substitutes the earlier due date reference in Part A – General.

8. Reporting of Presumptive Income of Non-Residents

[Applicable to ITR-3 and ITR-5]

Specific disclosure columns have been introduced in Schedule Part A – P&L for income covered under Sections:

  • 44B
  • 44BB
  • 44BBA
  • 44BBC
  • 44BBD

Non-resident taxpayers are now required to separately disclose:

  • Gross receipts/turnover; and
  • Net profits

from such presumptive businesses.

9. Disclosure of Investments by Presumptive Taxation Assessees

[Applicable to ITR-4]

A new reporting requirement has been introduced under “Financial Particulars of the Business” in ITR-4.

Taxpayers opting for presumptive taxation are now required to disclose the amount of investments made during the year.

This marks a notable expansion in disclosure obligations despite the simplified nature of presumptive taxation schemes.

10. “Total Value” Replaces “Nominal Value” for Trust Investments

[Applicable to ITR-7]

Schedule J in ITR-7 has replaced the expression “nominal value of investment” with “total value of investment.”

The change assumes significance in cases involving investments in concerns where specified persons under Section 13(3) possess substantial interest.

While “nominal value” generally refers to face value, “total value” encompasses the actual investment value, thereby widening the scope of scrutiny under Section 13(2)(h).

The amendment may materially impact determination of the 5% threshold beyond which exemption consequences arise under Sections 11 and 13.

11. Reporting of Validity Period of Registrations under Other Laws

[Applicable to ITR-7]

Part A – General in ITR-7 now additionally requires disclosure of:

  • Date up to which registration obtained under other laws remains valid.

This applies to registrations such as:

  • FCRA registration
  • DARPAN registration
  • SEBI registration
  • Other regulatory registrations

The amendment enables authorities to monitor continuity and renewal status of registrations that may constitute conditions precedent for charitable registration and exemption eligibility.

12. Clarification Regarding Interest Income Reporting in Schedule OS

[Applicable to ITR-2, ITR-3, ITR-5 and ITR-7]

The revised forms clarify that interest earned from:

  • Companies
  • Non-Banking Financial Companies (NBFCs)
  • Housing Finance Companies (HFCs)

must be reported under the “Other” category in Schedule OS where the Assessee is not engaged in money-lending business.

This includes interest from:

  • Fixed deposits
  • Debentures
  • Similar instruments

held with such entities.

13. Removal of Foreign Retirement Account Reporting from ITR-1 and ITR-4

[Applicable to ITR-1 and ITR-4]

Fields requiring disclosure of foreign retirement benefit account income have been removed from ITR-1 and ITR-4.

The amendment aligns with eligibility restrictions applicable to these forms, since taxpayers holding foreign assets or earning foreign income are not eligible to file ITR-1 or ITR-4.

The change removes redundancy and improves structural consistency.

14. Rationalization of Auditor Reporting Requirements

[Applicable to ITR-3, ITR-5, ITR-6 and ITR-7]

The revised forms substantially streamline auditor-related disclosures.

Earlier, extensive particulars including membership number, UDIN, audit report date, PAN/Aadhar, and firm registration details were required.

Now, only the following are required:

  • Date of furnishing audit report
  • Audit report acknowledgement number
  • Name of auditor/proprietorship/firm
  • PAN of proprietorship/firm

The amendment reduces duplication because several details are already available within audit report filings.

15. Removal of Dual Capital Gains Reporting Based on 23 July 2024

[Applicable to ITR-2, ITR-3, ITR-5, ITR-6 and ITR-7]

For AY 2025–26, taxpayers were required to bifurcate capital gains arising:

  • Before 23 July 2024; and
  • On or after 23 July 2024

due to mid-year amendments introduced through the Finance (No. 2) Act, 2024.

Since no similar transitional rate structure applies for PY 2025–26, the revised forms have eliminated this bifurcated reporting requirement.

16. Removal of Schedule BBS from ITR-6

[Applicable to ITR-6]

Schedule BBS relating to buyback taxation has been omitted from ITR-6.

Up to 30 September 2024:

  • Companies paid buyback tax; and
  • Shareholder income remained exempt under Section 10(34A).

From 1 October 2024 onwards:

  • Buyback proceeds became taxable in shareholders’ hands; and
  • Companies ceased to bear buyback tax liability.

Consequently, Schedule BBS lost relevance and has been removed.

17. Incorporation of Presumptive Scheme under Section 44BBD

[Applicable to ITR-3, ITR-5 and ITR-6]

Section 44BBD introduced by the Finance Act, 2025 provides presumptive taxation for non-residents engaged in providing services or technology relating to electronics manufacturing facilities in India.

Under this scheme:

  • 25% of specified receipts are deemed taxable income.

The revised forms now include:

  • Specific declaration in Part A – GEN; and
  • Corresponding disclosure in Schedule BP.

Although Section 44AB does not expressly exempt Section 44BBD assessees from audit requirements, the structure adopted in the revised ITR forms suggests legislative intent to treat Section 44BBD similarly to other presumptive schemes.

18. Separate Reporting for Interest Taxable at Concessional 9% Rate

[Applicable to ITR-2, ITR-3, ITR-5, ITR-6 and ITR-7]

Schedule OS now contains a dedicated field for interest income taxable under Section 194LC at the concessional rate of 9%.

This specifically relates to interest on:

  • Long-term bonds; or
  • Rupee-denominated bonds

issued on or after 1 July 2023 and listed on recognized stock exchanges in an IFSC.

The amendment facilitates TDS reconciliation and rate-specific reporting.

19. Revised Reporting Threshold for Substantial Contributors

[Applicable to ITR-7]

ITR-7 has been aligned with the amended Section 13(3)(b).

The revised forms now require disclosure of contributors where:

  • Contribution during the relevant previous year exceeds Rs. 1 lakh; or
  • Aggregate contribution up to year-end exceeds Rs. 10 lakh.

Earlier, the threshold stood at Rs. 50,000 aggregate contribution.

This amendment rationalizes the scope of reporting of specified persons.

20. Disclosure of Authority before whom Political Party Report is Filed

[Applicable to ITR-7]

Schedule PP in ITR-7 has been amended to require political parties to specify the authority before whom the prescribed report under Section 29C(3) of the Representation of the People Act, 1951 has been furnished.

The assessee must now indicate whether the report was filed before:

  • Election Commission of India; or
  • Concerned State Election Commission.