ITR-1 (Sahaj) – Key Changes for AY 2026–27

The ITR-1 (Sahaj) form for Assessment Year 2026–27 introduces several updates focused on better disclosure and simplified compliance:

1. New Disclosure – Section 234I
A new field has been added to report fees paid under Section 234I for filing a revised return, following the extension of the revised return filing timeline to 12 months.

2. Enhanced Reporting in Section 80G (Donations)
Taxpayers must now provide additional details for donations:

• IFSC code of the bank
• Transaction reference number (UPI/NEFT/RTGS/Cheque, etc.)

3. Additional Details in Section 80GGC (Political Contributions)
More transparency is required with mandatory disclosure of:

• Name of the political party
• PAN of the political party

4. Major Relaxation – House Property Limit Increased
Taxpayers can now report income from up to two house properties in ITR-1. Previously, the limit was restricted to one.

5. Removal of Foreign Retirement Account Fields
Fields relating to foreign retirement accounts have been removed, aligning the form strictly with ITR-1 eligibility conditions.

6. Simplified Representative Assessee Details
Reporting requirements for representative assessees have been reduced to:

• Name
• Email ID
• Contact number

These changes make ITR-1 more practical for small taxpayers while strengthening reporting standards where necessary.

ITR-2 – Key Changes for AY 2026–27

The ITR-2 form has been updated with several changes to improve disclosure standards and simplify reporting:

1. New Disclosure – Section 234I
A field has been added to report fees paid under Section 234I for filing a revised return.

2. Enhanced Reporting in Section 80G & 80GGC
Additional details are now mandatory:

• IFSC code of the bank
• Transaction reference number (UPI/NEFT/RTGS/Cheque, etc.)
• Name of the political party
• PAN of the political party

3. Update in Schedule OS (Other Sources)
A specific clarification has been introduced:

• Interest income from companies, NBFCs, and HFCs must be reported under the “Other” category.

4. Simplified Capital Gains Reporting

• No need to bifurcate capital gains before and after 23 July 2024, reducing complexity.

5. New Reporting – Section 194LC

• Separate disclosure required for interest income taxable at a concessional rate of 9%.

6. Simplified Assessee Details

• Representative assessee details have been streamlined.
• A secondary address field has been introduced, similar to ITR-1.

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ITR-3 (Business/Profession) – Key Update

New Disclosure for Futures & Options (F&O)
To improve reporting accuracy for traders, ITR-3 now requires:

• Turnover from Futures & Options (F&O)
• Income from F&O

This change brings more clarity and transparency for taxpayers engaged in derivatives trading.

ITR-4 (Sugam – Presumptive Income) – Key Changes for AY 2026–27

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The ITR-4 form has undergone notable updates, especially in financial disclosures and presumptive reporting:

1. Financial Particulars – Expanded Disclosure

• Taxpayers must now report investments made during the year
• Mandatory disclosure of closing bank balance has been introduced

2. New Disclosure – Section 234I

• Reporting of fees paid for filing a revised return is now required

3. Enhanced Reporting in Section 80G & 80GGC

• IFSC code and transaction reference number mandatory
• Political donation reporting must include:
  • Name of the political party
  • PAN of the political party

4. Major Relaxation – House Property Limit Increased

• Taxpayers can now report up to 2 house properties (earlier limited to 1), similar to ITR-1

5. Removal of Foreign Retirement Account Fields

• These fields have been removed to align with eligibility conditions

6. Simplified Assessee Details

• Reduced reporting for representative assessee
• Secondary address field introduced

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🔥 Key Practical Highlights (Very Important)

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1. Increased Focus on Transaction Traceability

• Donations and political contributions now require detailed tracking (IFSC, reference number, PAN)

2. Strong Compliance Push On:

• MSME payments
• Futures & Options (F&O) transactions
• Presumptive income disclosures

3. Big Relief for Small Taxpayers

• Both ITR-1 and ITR-4 now allow reporting of up to 2 house properties

4. Higher Data Transparency

• Investment disclosure (ITR-4)
• Bank closing balance reporting (ITR-4)

5. Simplification Measures Introduced

• Easier capital gains reporting (ITR-2)
• Reduced auditor-related details
• Removal of irrelevant/non-applicable disclosures