New ITR forms under 2025 Income Tax Act to be notified before FY28: Govt

The documents will make tax filing easier by reducing legal wording, say experts

New Income Tax return (ITR) forms will be notified ahead of FY28, the government told Lok Sabha on Monday, simplifying the annual financial management exercise.

 

The forms were updated for the Income Tax Act, 2025, which was enacted on August 21 and come into effect from April 1, 2026. It will replace the Income Tax Act, 1961, aiming to simplify tax laws and make them easier to understand by reducing legal wording.

 

As part of this process, all forms under the Income Tax Act, including ITR forms and TDS quarterly return forms, are being reworked. The Central Board of Direct Taxes (CBDT) has set up a committee to consult extensively with tax experts, institutional bodies, and field formations of the Income Tax Department to make the forms more taxpayer-friendly.

 

“ITR forms relating to Income Tax Act, 2025, will require the changes in consequence of amendments to the said Act made during Budget 2026, and, accordingly, ITRs pertaining to the first tax year 2026-27 shall be notified prior to FY 2027-28,” said Pankaj Chaudhary, Minister of State for Finance, in a written reply, according to PTI.

 

For income earned in FY26 (Assessment Year 2026-27), ITR forms will continue under the provisions of the Income Tax Act, 1961.

 

Consolidation and simplification of these forms are in progress, aiming to reduce complexity for taxpayers.

 

New forms under the 2025 Act will incorporate any changes announced in Budget 2026, ensuring alignment with the updated legislation.

 

New ITR forms are expected to make filing taxes simpler, particularly for individual taxpayers. By streamlining processes and reducing legal jargon, the government hopes to encourage compliance and reduce errors in tax returns.

 

Tax experts note that such reform could also improve efficiency in processing returns and claims, as the simplified forms will allow the Income Tax Department to work with clearer and more standardised information.

 

With the notification expected well before the start of FY28, taxpayers will have sufficient time to familiarise themselves with the new forms and requirements under the Income Tax Act, 2025.  (with inputs from PTI)