Income Tax Return Insights AY 2025-26

Section 234A: Interest at 1% per month on unpaid tax from the due date until actual filing
Section 234F: Late filing fee up to ₹5,000 (₹1,000 if income is below ₹5 lakh)
Loss carry-forward: Not allowed unless return is filed on time

ITR-2 and ITR-3 are now enabled for e-filing for AY 2025–26
Excel utilities for these forms are live; online filing is expected soon
ITR-1 and ITR-4 have expanded eligibility—now include long-term capital gains up to ₹1.25 lakh from listed equity shares and mutual funds

Capital Gains Split: Due to recent changes in the Finance Act, gains from transactions before and after July 23, 2024 must be reported separately.
Buyback Losses: Losses from share buybacks are permissible only if the dividend income is declared under “Income from Other Sources”.
Asset & Liability Threshold Raised: Reporting required only if total income exceeds ₹1 crore (up from ₹50 lakh)

House Rent Allowance (HRA): Must disclose rent paid, HRA received, salary details, and the type of city.
Home Loan Deductions: Must include lender name, loan account number, sanction date, and interest paid.
Section 80C Investments: Now require detailed documentation details like PPF account numbers, insurance policy number and Tuition Fees paid details.

TDS Section Codes: Must be specified in Schedule-TDS for better traceability
Aadhaar Enrollment ID: No longer accepted for PAN or ITR filing—actual Aadhaar number is mandatory
Disability Deductions: Require Form 10-IA and certificate acknowledgment number.
Form 10-IEA: Mandatory for opting out of the new tax regime; acknowledgment number must be disclosed.
Delays in Refunds & Increased Scrutiny
- Section 245 invoked: Refunds may be withheld if past assessments or tax demands are pending
- AI-based scrutiny: New systems like AIS and TIS may flag mismatches, causing delays even for small refund claims
- Experts suggest: Partial refunds, better communication, and faster processing for low-risk taxpayers

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