The Income Tax Department has set July 31, 2026, as the deadline for most individual taxpayers, including the salaried class, to file their Income Tax Returns for AY 2026-27. However, non-audit businesses and professionals filing ITR-3 or ITR-4 get an additional month and can file until August 31, 2026, creating separate filing windows even among non-audit taxpayers. According to Tax2win CEO Abhishek Soni, this noteworthy change means salaried taxpayers continue to have a July 31 deadline while non-audit taxpayers have until August 31, adding to the confusion among first-time filers who are already struggling with tax system complexities.
First-time taxpayers are experiencing unprecedented filing errors during the ongoing ITR filing season for Assessment Year 2026-27. According to Mint, Mrinal Mehta, Joint Secretary at Bombay Chartered Accountants' Society (BCAS), explains that this season has drawn a large wave of first-time taxpayers — younger salaried earners, gig workers and new investors. The errors are multiplying mainly because the framework around them has changed faster than their awareness has, creating significant confusion in the income tax system.
Taxpayers who satisfy conditions for mandatory ITR filing as per the Seventh proviso of Section 139(1) of the Income Tax Act face specific requirements. As reported by Tax2win, these conditions include spending ₹2 lakh or more on foreign travel, paying ₹1 lakh or more as electricity bills, or depositing ₹1 crore or more in current accounts. Additionally, taxpayers whose accounts are subject to tax audit have October 31, 2026 as their deadline, while those covered under transfer pricing provisions face November 30, 2026 deadline. The penalty structure under Section 234F of the Income Tax Act, 1961, imposes late fees of up to ₹5,000 for filing after due dates, with reduced penalties of ₹1,000 for taxpayers with income up to ₹5 lakh.
Another common mistake is choosing the wrong income tax return form, particularly affecting salaried taxpayers with investment income. According to Mint, even small capital gains can make ITR-1 invalid, yet many salaried first-timers continue with the simpler form and end up with a defective return. The trap of choosing the wrong ITR form is particularly relevant for salaried taxpayers who have started investing in mutual funds or equities, where even minor capital gains can change the applicable ITR form and may require correction or re-filing.
Digital filing convenience through the e-filing portal has introduced new challenges with pre-filled data accuracy. As reported by Mint, taxpayers are treating AIS (Annual Information Statement), TIS (Taxpayer Information Summary) and Form 26AS as final, without reconciling savings interest, dividends or capital gains. Any mismatch in reporting can result in automated notices or scrutiny within weeks, requiring careful cross-checking with personal financial records before filing.
The confusion is compounded by discussions around the New Income Tax Act, 2025, which applies from FY 2026-27, not these current returns. According to Mint, many taxpayers mistakenly assume that the new law already applies for this year's filing, leading to unnecessary confusion. In reality, the current ITR filing season relates to income earned in FY 2025-26 (AY 2026-27) and is governed by the Income-Tax Act, 1961, while the new law will apply to income earned from FY 2026-27 onwards. The provisions related to filing are contained in Section 263 of the Income Tax Act, 2025, which maintains the fundamental structure of mandatory filing, due dates, and categories of persons obligated to file.
