Tax Brief — Thursday, 15 October 2026

🧾 Section 115BAC default regime and slab structure (AY 2026-27 / FY 2025-26, Income-tax Act, 1961) (official)

The Income Tax Department notes that following amendments under the Finance Act, the new tax regime under Section 115BAC is the default tax regime for Individuals, HUFs, AOPs, BOIs, and Artificial Juridical Persons for AY 2026-27 / FY 2025-26 (Income-tax Act, 1961). Eligible taxpayers have the option to opt out and be taxed under the old tax regime.

Under Section 87A of the Income Tax Act, 1961, resident individuals are eligible for a rebate of up to 100% of income tax subject to a maximum limit of ₹60,000 where taxable income does not exceed ₹12,00,000 under the new tax regime.

Why it matters: The default regime slab rates and rebate under Section 87A apply to eligible assessees who do not opt out.

Sources: Income Tax Department

Related on HeyArtha: Business Income Tax Calculator

🏢 Form 10-IEA compliance for business assessees (AY 2026-27 / FY 2025-26, Income-tax Act, 1961) (official)

For eligible taxpayers with income from business or profession who wish to opt out of the default tax regime for AY 2026-27 / FY 2025-26 (Income-tax Act, 1961), the Income Tax Department specifies that Form 10-IEA must be furnished on or before the due date specified under Section 139(1) of the Income Tax Act, 1961. Withdrawal from the old tax regime and re-entering the default regime is permitted only in a subsequent assessment year and is available only once in a lifetime for business cases.

Why it matters: Eligible taxpayers with income from business and profession who want to opt out of the default regime must furnish Form 10-IEA on or before the due date under Section 139(1).

Sources: Income Tax Department

📅 CBDT extends statutory audit and return filing deadlines (AY 2026-27 / FY 2025-26, Income-tax Act, 1961) (official)

As per Circular No. 07/2026 issued by the Central Board of Direct Taxes, the due date for filing Audit Reports for AY 2026-27 in the cases of assessees mentioned at Sl. No. 2 in the Table below Explanation 2 to Section 139(1) of the Income Tax Act, 1961 is extended from 30 September 2026 to 21 October 2026. Furthermore, the due date for filing Income Tax Returns for these cases is extended from 31 October 2026 to 21 November 2026.

Why it matters: Circular No. 07/2026 extends the due dates for filing Audit Reports to 21 October 2026 and Income Tax Returns to 21 November 2026 for qualifying cases under Section 139(1).

Sources: Income Tax Department

📋 ITR-1 Sahaj and ITR-4 Sugam eligibility criteria (AY 2026-27 / FY 2025-26, Income-tax Act, 1961) (official)

Official guidelines for AY 2026-27 / FY 2025-26 under the Income-tax Act, 1961 specify that ITR-1 (Sahaj) applies to resident individuals with total income up to ₹50 lakh from salary/pension, one house property, and other sources, and capital gains under Section 112 A up to ₹1,25,000. Taxpayers with director roles, unlisted shares, foreign assets, or Section 112 A gains exceeding ₹1,25,000 cannot use ITR-1. ITR-4 (Sugam) applies to resident individuals, HUFs, and firms (other than LLPs) with income computed on a presumptive basis under Section 44AD, 44ADA, or 44AE with total income up to ₹50 lakh.

Why it matters: Official return eligibility conditions govern the selection between ITR-1 (Sahaj) and ITR-4 (Sugam) based on total income and source of income.

Sources: Income Tax Department

Related on HeyArtha: Presumptive Tax Calculator, Property Capital Gains Preview

📄 Annual Information Statement and Form 26AS verification (official)

The Income Tax Department provides Form 26AS and the Annual Information Statement (AIS) via the e-filing portal. Both Form 26AS and AIS provide details of Tax Deducted / Collected at Source.

Why it matters: Taxpayers can view and verify details of tax deducted or collected at source provided by the Income Tax Department.

Sources: Income Tax Department

🛡️ Permissible deductions under Section 115BAC (AY 2026-27 / FY 2025-26, Income-tax Act, 1961) (official)

Under the default new tax regime for AY 2026-27 / FY 2025-26 (Income-tax Act, 1961), while general Chapter VI-A deductions are restricted, specific statutory deductions remain available: Section 80CCD (2) for employer contributions to the central government pension scheme (up to 10% of salary for PSU and private employers, and 14% for Central or State Government), and Section 80CCH for contributions to the Agnipath Scheme and Agniveer Corpus Fund.

Why it matters: Eligible assessees can claim deductions for employer pension contributions under Section 80CCD (2) and contributions to the Agnipath Scheme under Section 80CCH under the default regime.

Sources: Income Tax Department

⚖️ CBDT notifies revised Form 161 for penalty waiver (Income-tax Act, 2025) (official)

CBDT has issued Notification No. 134/2026 dated 8 October 2026, notifying the Income-tax (Sixth Amendment) Rules, 2026. The amendment introduces a revised Form 161 for filing applications for waiver of penalty under Section 440(2) of the Income-tax Act, 2025.

Why it matters: The Income-tax (Sixth Amendment) Rules, 2026 introduce a revised Form 161 for filing applications for waiver of penalty under Section 440(2) of the Income-tax Act, 2025.

Sources: Income Tax Department