Filing ITR in 2026 is genuinely easier than it was five years ago — the new income-tax portal pre-fills most fields from AIS, TIS, and Form 26AS — but the audit trail is also tighter. Mismatches between what you file and what the department already knows trigger automated 143(1) notices.
This is the practical step-by-step for AY 2026-27.
What changed in 2026
- AIS (Annual Information Statement) and TIS (Taxpayer Information Summary) are the canonical truth — ITD has 50+ data sources flowing in (banks, brokers, mutual funds, RTAs, registrar offices, employers). Reconciliation is no longer optional.
- New regime is the default — if you don't tick the old-regime box explicitly (Form 10-IEA), you're filed under the new regime. Salaried filers can switch every year; business income is one switch lifetime.
- PAN-Aadhaar linking is now mandatory for filing — unlinked PAN is treated as inoperative.
Pick the right ITR form
- ITR-1 (Sahaj) — total income up to ₹50 lakh, salary + one house property + other sources (interest). No capital gains, no foreign assets.
- ITR-2 — same as ITR-1 but allows capital gains, multiple properties, foreign income/assets, agricultural income > ₹5,000. Most salaried filers with mutual fund redemptions or stock sales need ITR-2.
- ITR-3 — business or professional income (freelancers, consultants, F&O traders).
- ITR-4 (Sugam) — presumptive income (44AD/44ADA) for small business or professionals up to specified limits.
If you traded F&O even once in the year, you have business income — ITR-3, not ITR-2.
The actual filing flow
- Log in to incometax.gov.in with PAN as user ID. Aadhaar OTP is the fastest 2FA.
- Download AIS, TIS, Form 26AS before starting. Print or PDF them.
- Open ITR filing → Year 2026-27 → choose the right form.
- Verify pre-filled data — salary from Form 16, interest from banks, dividend, capital gains. Reconcile with your broker's P&L statement (Zerodha Console, Groww report, etc.).
- Add deductions if old regime — 80C, 80D, 80E, HRA, home loan interest under 24(b).
- Compute tax — portal does it. Cross-check tax payable / refund against your own calc.
- Pay self-assessment tax if due, via challan 280 or net-banking link.
- Submit and e-verify — Aadhaar OTP, net banking, or DSC. EVC must be done within 30 days, else the return is invalid.
AIS reconciliation — where notices come from
The biggest source of 143(1) notices is AIS-vs-ITR mismatch. Common cases:
- Dividend income from mutual funds shown in AIS but not declared in ITR
- Interest from FDs across multiple banks aggregated in AIS but only one bank's interest declared
- Crypto / digital asset transactions in AIS but not under Schedule VDA
- Foreign assets (US stocks via Vested, INDmoney) in AIS but not in Schedule FA
Reconcile every line in AIS to a corresponding entry in your ITR before submitting.
Capital gains — the section that trips most filers
For mutual funds and equity, you need:
- Equity LTCG (held > 12 months, taxed 12.5% above ₹1.25 lakh exemption)
- Equity STCG (held ≤ 12 months, taxed 20%)
- Debt MF (any holding period, taxed at slab — indexation removed in 2024)
- Foreign equity (taxed at slab as STCG, or 12.5% LTCG after 24 months)
Brokers issue capital-gain statements (Zerodha Console, Groww, Coin, etc.). Match them to AIS — if one is wrong, fix the broker statement before filing, not in the ITR.
Comparison: ITR forms in AY 2026-27
| Form |
For |
Income limit |
Capital gains |
Foreign assets |
| ITR-1 |
Salaried, simple |
≤ ₹50 lakh |
No |
No |
| ITR-2 |
Capital gains, multi-property |
None |
Yes |
Yes |
| ITR-3 |
Business / F&O / freelancer |
None |
Yes |
Yes |
| ITR-4 |
Presumptive (44AD/ADA) |
≤ ₹50 lakh prof; ₹2 cr biz |
Limited |
No |
FAQ
What if I miss the July 31 deadline?
Belated return till December 31 with late fee under 234F (₹1,000 if income ≤ ₹5 lakh; ₹5,000 otherwise) and interest under 234A on tax due.
Do I need to file if income is below the basic exemption?
Generally no, but yes if: TDS was deducted (and you want refund), foreign assets, deposits > ₹1 cr in current account, electricity bill > ₹1 lakh, foreign travel > ₹2 lakh.
How long does refund take?
Usually 7–30 days after e-verification, paid to the pre-validated bank account. Make sure your account is pre-validated on the portal.
Where to go next
For related guides see Section 80C tax saving for 2026, PPF vs ELSS vs NPS in 2026, and Crypto tax reporting guide for 2026.