Income Tax Return (ITR) Filing in Raipur

An important transition this year

The Income-tax Act, 1961 has been replaced by the Income-tax Act, 2025, which came into force on 1 April 2026. This is a restructuring rather than a change in tax policy: rates, slabs, deductions and exemptions are unchanged, but the law has been rewritten into 536 sections in place of 819, and almost every section number has changed. The Income Tax Rules, 1962 have likewise been replaced by the Income Tax Rules, 2026.

For the return being filed this year, the practical position is this:

• The return for FY 2025-26 (AY 2026-27) is governed entirely by the Income-tax Act, 1961, because it relates to income earned before 1 April 2026. The familiar section numbers and the familiar forms apply.
• From Tax Year 2026-27 onwards — income earned from 1 April 2026, reported in returns filed in 2027 — the new Act governs. The new Act also replaces the twin concepts of "previous year" and "assessment year" with a single "tax year".

Why the transition matters this year

The transition matters in practice because records, software, TDS certificates and correspondence will straddle both frameworks for the next two years, and because a pending assessment or appeal for an earlier year continues under the old Act. We handle both frameworks and map between them where a client's position spans the changeover.

Due dates for AY 2026-27

The 31 August date is new and worth noting. Non-audit business and professional filers using ITR-3 or ITR-4 now have until 31 August rather than 31 July, and this is a standing change to the law rather than a one-off extension. Salaried filers on ITR-1 and ITR-2 remain on 31 July. For anyone with both salary and business income, the applicable date follows the form, so the distinction is worth establishing early rather than assumed.

Where a tax audit applies, the audit report falls due a month before the return — so the 30 September date, not the 31 October one, is the date that actually governs the work.

Which return form applies

Selecting the wrong form is one of the more common reasons a return is treated as defective, and the choice is driven by the nature of income rather than its size.

• ITR-1 — resident individuals with salary, one or two house properties, other income and limited long-term capital gains, within the prescribed income limit
• ITR-2 — individuals and HUFs with capital gains, more than the permitted number of properties, foreign income or assets, or income above the ITR-1 limit
• ITR-3 — individuals and HUFs with income from business or profession
• ITR-4 — resident individuals, HUFs and firms opting for presumptive taxation, within the prescribed limits
• ITR-5 — partnership firms, LLPs and associations of persons
• ITR-6 — companies other than those claiming exemption for charitable purposes
• ITR-7 — trusts, institutions and entities claiming exemption

A wider net for the simpler forms this year

For AY 2026-27, ITR-1 and ITR-4 accommodate a second house property and a limited amount of long-term capital gains, which brings some taxpayers back into the simpler forms who previously had to use ITR-2.

Choosing between the two regimes

The new regime applies by default. The old regime, with its deductions and exemptions, remains available but has to be opted for — and for a business or professional taxpayer, the option is exercised in a prescribed manner within a time limit, which is easy to miss.

There is no general answer to which regime is better. It depends on the actual deductions available to the particular taxpayer: house rent, housing loan interest, insurance, provident fund, tuition fees, medical insurance, and the standard deduction. We compute the liability both ways before filing rather than applying a rule of thumb.

One consequence of a late return deserves emphasis. If the return is filed after the due date, the option to move to the old regime for that year is lost. For a taxpayer whose deductions make the old regime materially better, missing the date can cost far more than the late fee.

Situations we deal with regularly in Raipur

Sale of land and property. Land transactions in and around Raipur, and in the Naya Raipur belt, are a recurring source of both large gains and avoidable tax. The questions that arise are whether the land qualifies as agricultural land outside the definition of a capital asset, how the holding period and indexation apply, whether the gain can be sheltered by reinvestment in a residential house or in specified bonds, and how the stamp duty value interacts with the stated consideration. These are decisions best taken before the transaction, not while preparing the return.

Agricultural income. In an agrarian state, the boundary between exempt agricultural income and taxable business income is a live issue — particularly where land is leased out, where produce is processed before sale, or where income arises from trading rather than cultivation. Claims that are not properly supported attract attention, and the department has data on landholding to test them against.

Salaried employees of local industry. Employees of the steel, cement and manufacturing units around Raipur commonly have salary alongside interest income, house property, and sometimes shares or mutual funds. Where Form 16 and the annual information statement do not agree, that difference has to be reconciled before filing rather than explained afterwards.

Traders, commission agents and contractors. Presumptive taxation suits many small businesses, but not all — and the decision has consequences for books of account, audit applicability, and the ability to claim actual expenses where margins are thin. Contractors in particular often have substantial tax deducted at source that must be matched to the year of income.

Professionals. Doctors, architects, engineers, consultants and others can use the presumptive scheme for professionals within the prescribed limit. Whether they should is a separate question, and depends on the actual expense ratio of the practice.

Firms, LLPs and companies. Returns for these entities are bound up with the annual accounts, partner or director remuneration, disallowances, and where applicable the tax audit — which is why the work is better done alongside the accounts rather than after them.

Before we file

• Reconciliation with departmental records. The annual information statement and the tax credit statement together show what the department already knows about a taxpayer's interest, dividends, securities transactions, property dealings and tax deducted. A return that does not agree with these is the most common trigger for correspondence. We reconcile first.
• Tax deducted at source. Credit is matched to the correct year and, where a deductor has not reported a deduction, taken up so that the credit is not lost.
• Advance tax and interest. Interest for shortfall or deferment of advance tax is computed and disclosed rather than left to be raised later in a demand.
• Carry-forward of losses. Business and capital losses can only be carried forward if the return is filed by the due date, which is often reason enough on its own not to be late.
• Verification. A return that is filed but not verified is treated as not filed at all.

If the due date has been missed

A belated return may be filed up to 31 December 2026 for AY 2026-27. A late fee applies, interest runs on unpaid tax, the option of the old regime is lost, and business and capital losses cannot be carried forward.

A revised return may be filed up to 31 March 2027 where an error is discovered in a return already filed.

An updated return may be filed within 48 months from the end of the assessment year, subject to conditions, where income was not fully disclosed. Additional tax applies, and the facility is not available in every situation, but it now also permits carry-forward of losses in circumstances where it previously did not. For a taxpayer with an omission from an earlier year, this is often a better route than waiting for the department to raise it.

The late fee for a return filed after the due date is ₹5,000, reduced to ₹1,000 where total income does not exceed ₹5,00,000. Interest on unpaid tax applies separately.

Scope of our work

We determine the correct return form and residential status; compute income under each head, including capital gains, house property, business or profession and other sources; compare the old and new regimes on actual figures; reconcile the annual information statement and tax credit statement; claim and match tax deducted at source; compute advance tax and interest exposure; prepare and file the return and complete verification; and deal with defective return notices and rectification where these arise. For business assessees we prepare the computation alongside the accounts, and where a tax audit applies we handle the audit and the return together.