Tag: Section 263

Senior Citizens Aged 75 or More: When No Income Tax Return Is Needed (Form 125, Tax Year 2026-27)

Posted on by CA Meet Dhrangadhariya

Last updated: 19 September 2026 · Written and reviewed by CA Meet Dhrangadhariya, CSM & Co LLP

Quick summary

  • A resident aged 75 or more whose only income is pension and interest from the same specified bank, and who gives the bank a declaration in Form 125, need not file a return for a year in which the bank deducts tax (section 263(8)(b), earlier section 194P).
  • The bank works out the tax on the total income after Chapter VIII deductions and the section 156 rebate, and deducts it at the rates in force (Rule 208).
  • The relief is lost if there is any other income, such as rent or interest from another bank, or if the bank does not deduct tax under the provision.
  • Higher TDS and TCS for non-filers (old sections 206AB and 206CCA) were omitted from 1 April 2025 and are not in the 2025 Act.

A retired person whose income is only a pension and the interest on the account into which the pension is paid can be spared the trouble of a return. The rule was section 194P of the 1961 Act; in the Income-tax Act, 2025 it is split between the definition of a “specified senior citizen” (section 402(39)), the relief from filing a return (section 263(8)(b)) and the bank’s duty to deduct tax (section 393(1), Table serial 8(iii)).

Who is a “specified senior citizen”

An individual who is:

  1. a resident in India;
  2. aged 75 years or more at any time during the tax year;
  3. having pension income and no other income except interest received or receivable from an account kept in the same specified bank in which the pension is received; and
  4. someone who has furnished a declaration to that specified bank, in the prescribed form and manner.

A specified bank is a banking company that the Central Government has notified for the purpose (section 402(35)).

What the relief is

Section 263 is the section that requires a return. Section 263(8)(b) says it does not apply to a specified senior citizen for the tax year in which tax has been deducted at source by the specified bank under section 393(1), Table serial 8(iii). So no return is needed for that year. The section on updated returns (section 263(6)) also does not apply to such a person for that year.

How the bank deducts tax (Rule 208)

  • You give the bank a declaration in Form 125. It asks for your PAN, date of birth, the pension payer and pension payment order number, your accounts with the bank, and whether you opt out of the new regime under section 202. In the declaration you state that you have no income other than pension and interest in the accounts with that bank.
  • The bank computes your total income for the year after giving effect to the deductions under Chapter VIII, on the evidence you furnish during the year, and the rebate under section 156.
  • It deducts income-tax at the rates in force on that total income (Rule 208(2)).
  • The bank keeps the declaration and the evidence and must make them available to the Chief Commissioner when required (Rule 208(4)).

This means the bank, not you, finishes the tax computation for the year.

When the relief does not apply

  • You have other income, for example rent, interest from a deposit with another bank, capital gains or dividends. You are then not a specified senior citizen and must file a return if your income exceeds the exemption limit.
  • You did not give the declaration to the bank or it is not a specified bank.
  • Your age is below 75 in the whole tax year.
  • You are a non-resident.

If any of these happens, file the return, using the TDS deducted by the bank as credit.

Example

A resident aged 78 receives a pension of ₹6,00,000 a year through a specified bank and gets ₹1,20,000 interest on his savings and fixed deposit accounts in the same bank. He has no other income. He gives Form 125 to the bank at the start of the year, and the bank works out his total income after the deductions and the rebate that apply and deducts tax if any is due. He need not file a return for that year.

If he also had ₹30,000 of rent, he would not qualify, and he would have to file a return, with credit for the tax the bank deducted.

Higher TDS for non-filers is gone

Sections 206AB and 206CCA of the 1961 Act required higher TDS and TCS from a person who had not filed returns. The Finance Act, 2025 omitted them from 1 April 2025, and the Income-tax Act, 2025 has no such provision. Deductors no longer need to check whether a person has filed before deducting tax. The late fee and interest for a missed return still apply.

Practical advice for pensioners

  1. Give Form 125 to the bank at the beginning of the year, not the end.
  2. Keep all savings and deposits in the one specified bank if you rely on this relief.
  3. If your income changes, for example a rent receipt starts, tell the bank and file a return.
  4. Check your Form 130 and the pension TDS for the year, and the annual information statement, for any other income reported against your PAN.

Frequently asked questions

Who need not file an ITR at age 75?

A resident individual aged 75 or more at any time in the tax year whose only income is pension, plus interest from an account in the same specified bank that pays the pension, who has furnished the declaration in Form 125 to that bank, and from whose income the bank has deducted tax (section 402(39) and section 263(8)(b)).

What if I have rent or interest from another bank?

Then you are not a specified senior citizen for that year. You must file a return if your income exceeds the exemption limit, and the bank cannot give you the benefit of this provision.

Who calculates the tax?

The specified bank. It computes your total income after the deductions under Chapter VIII (on the evidence you give during the year) and the rebate under section 156, and deducts tax at the rates in force (section 393(1), Table serial 8(iii), and Rule 208).

Which tax regime applies?

The new regime is the default. Form 125 asks whether you opt out of the new regime under section 202.

Is any bank allowed to do this?

Only a banking company notified by the Central Government as a specified bank (section 402(35)).

Are higher TDS rates for non-filers still there?

No. Sections 206AB and 206CCA of the 1961 Act were omitted from 1 April 2025 and the 2025 Act has no such provision.

Official sources

Related reading

Disclaimer

This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.

Late, Revised and Updated Income Tax Returns: Time Limits, Fee, Interest and Additional Tax (Tax Year 2026-27)

Posted on by CA Meet Dhrangadhariya

Last updated: 05 September 2026 · Written and reviewed by CA Meet Dhrangadhariya, CSM & Co LLP

Quick summary

  • A return missed by the due date can be filed within nine months from the end of the tax year (section 263(4)) with a fee of ₹1,000 if total income is up to ₹5 lakh and ₹5,000 otherwise (section 428), plus interest at 1% a month on tax due (section 423).
  • A return with an error can be revised within 12 months from the end of the tax year (section 263(5), as amended by the Finance Act, 2026); the same fee applies if the revised return is filed after nine months.
  • An updated return (ITR-UN) can be filed up to 48 months after the end of the financial year following the tax year, with additional tax of 25%, 50%, 60% or 70% of tax and interest (section 267).
  • An updated return cannot reduce tax, create or increase a refund, or be a loss return, with limited exceptions.

Missing the due date, finding an error or realising later that you left out income does not close the door on you. The Income-tax Act, 2025 gives three ways to file again, each with its own time limit and cost. This post uses the section numbers of the 2025 Act, which applies to tax year 2026-27 (income of FY 2026-27).

At a glance

Return Section Last date for tax year 2026-27 Cost
Original return 263(1) 31 July 2027 (other dates for audit and business cases) None
Belated return 263(4) 31 December 2027 (nine months from the end of the tax year) Fee under section 428 and interest under section 423
Revised return 263(5) 31 March 2028 (12 months from the end of the tax year) Fee under section 428(b) if filed after nine months
Updated return 263(6) 31 March 2032 (48 months from the end of the financial year following the tax year) Additional tax of 25% to 70% (section 267)

In each case the deadline is the earlier of that date and the completion of the assessment, except for the updated return.

1. Belated return (section 263(4))

If you did not file on or before the due date, you can file within nine months from the end of the tax year, or before the assessment is completed, whichever is earlier.

Fee (section 428(a)):

Total income Fee
Up to ₹5,00,000 ₹1,000
More than ₹5,00,000 ₹5,000

Interest (section 423): simple interest at 1% a month on the unpaid tax, from the day after the due date to the date of filing, where unpaid tax means tax on total income less advance tax, TDS and TCS paid. The interest is computed as I = 1% × A × T, where A is that tax and T is the number of months in the period.

Example. Total income ₹8,00,000 in tax year 2026-27; tax after TDS and advance tax is ₹50,000. You file on 31/10/2027, three months after the 31/07/2027 due date.

  • Fee: ₹5,000
  • Interest: 1% × 50,000 × 3 = ₹1,500
  • Pay the tax, the interest and the fee before you file; the return is not complete without them.

Consequences of a belated return: you may lose the right to carry forward a business or capital loss, because a loss must be determined in a return filed under section 263(1) (section 121). Some deductions and claims also need the return to be on time. Check each claim.

2. Revised return (section 263(5))

If you filed a return under section 263(1) or (4) and find an omission or a wrong statement, you can file a revised return within 12 months from the end of the tax year, or before the assessment is completed, whichever is earlier. The Finance Act, 2026 extended this period from nine to twelve months with effect from 01/04/2026.

If the revised return is furnished after nine months from the end of the tax year, you pay the fee in section 428(b): ₹1,000 if total income is up to ₹5,00,000 and ₹5,000 otherwise.

A revised return replaces the original. Use it for corrections such as TDS credit missed, a wrong deduction or income left out, if the time is open.

3. Updated return (section 263(6) and Rule 165)

An updated return can be filed by any person, whether or not he filed an earlier return, at any time within 48 months from the end of the financial year succeeding the tax year. It is meant to disclose additional income, and the return is in Form ITR-UN (Rule 165).

Additional tax (section 267(5)): on the aggregate of tax and interest payable on the updated return, including surcharge and cess:

When filed Additional tax
After the belated and revised return windows have expired, and within 12 months from the end of the financial year succeeding the tax year 25%
In the next 12 months 50%
In the third 12 months 60%
In the fourth 12 months, up to 48 months 70%

If the updated return is filed in response to a notice under section 280 within the time in the notice, a further 10% of tax and interest is payable.

You pay the tax, interest, fee and additional tax before filing, and attach proof of payment (section 267(3)).

When an updated return is not allowed (section 263(6)(c) and (d))

  • It is a return of loss, except where you had filed a loss return on time and the updated return is a return of income or reduces the loss.
  • It reduces the total tax liability from the earlier return.
  • It creates or increases a refund.
  • An updated return was already filed for the year.
  • An assessment, reassessment, recomputation or revision is pending or completed for the year (unless it is filed in response to a notice under section 280).
  • The Assessing Officer has information about a violation of specified laws, or information has been received under a tax treaty, and has been communicated to you before you file.
  • Prosecution proceedings have been started for the year.
  • Thirty-six months have expired from the end of the financial year following the tax year and a show-cause notice under section 281 has been issued.
  • A search, requisition or survey has been conducted, for the year of the search and earlier years.
  • A class of persons notified by the Board.

If a loss or credit carried forward is reduced by the updated return, an updated return must be filed for each later year that is affected.

Which to choose

  1. Missed the due date and no income was left out: file the belated return as soon as possible, so the fee and interest are smaller.
  2. Filed on time but made a mistake: file a revised return within 12 months.
  3. Left out income and the revised window has closed: file an updated return; the additional tax rises with delay.
  4. Left out income and you got a notice: respond as the notice says; the updated return route in response to a notice carries an extra 10%.

For FY 2025-26 (assessment year 2026-27)

Income of FY 2025-26 is still under the 1961 Act, with the Finance Act, 2026 amendments from 01/03/2026. The same ideas apply there under sections 139(4), 139(5) and 139(8A) of that Act, with fee under section 234F and interest under section 234A. The belated return for that year can be filed up to 31 December 2026 and the revised return until the end of the assessment year, 31 March 2027. Check your forms and the portal for the dates that apply to your return.

Frequently asked questions

What is the last date to file a belated return?

Within nine months from the end of the tax year, or before the assessment is completed, whichever is earlier (section 263(4)). For tax year 2026-27 that is 31 December 2027.

What is the fee for filing late?

₹1,000 if total income does not exceed ₹5,00,000, and ₹5,000 in any other case (section 428), plus interest under section 423 at 1% a month on the unpaid tax.

How long can I revise a return?

Within 12 months from the end of the tax year, or before the assessment is completed, whichever is earlier (section 263(5)). If you file the revised return after nine months from the end of the tax year, the same fee of ₹1,000 or ₹5,000 applies.

What is an updated return?

A return you can file at any time within 48 months from the end of the financial year following the tax year, whether or not you filed an earlier return, to report income you missed. It carries additional tax and is filed in Form ITR-UN (Rule 165).

How much is the additional tax on an updated return?

25% of tax plus interest if filed after the revised return window but within 12 months from the end of the financial year following the tax year; 50% in the second year, 60% in the third and 70% in the fourth. If filed in response to a notice, a further 10% (section 267(5)).

When is an updated return not allowed?

If it is a return of loss (with a limited exception), reduces tax, creates or increases a refund, was already filed once for the year, assessment or reassessment is pending or completed (with a notice-related exception), or in certain cases of search, survey, prosecution or information received (section 263(6)(c) and (d)).

Official sources

Related reading

Disclaimer

This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.

Who Must File an Income Tax Return and Due Dates (Tax Year 2026-27)

Posted on by CA Meet Dhrangadhariya

Last updated: 05 September 2026 · Written and reviewed by CA Meet Dhrangadhariya, CSM & Co LLP

Quick summary

  • Section 263 of the Income-tax Act, 2025 requires a return from companies, firms and certain institutions regardless of income, from other persons whose total income before specified deductions exceeds the basic exemption limit, and from anyone with a business or capital gains loss to carry forward or foreign assets.
  • Rule 163 adds conditions that force a return even below the exemption limit: current account deposits above ₹1 crore, foreign travel above ₹2 lakh, electricity above ₹1 lakh, business turnover above ₹60 lakh and others.
  • Due dates for tax year 2026-27 are 31 July 2027 for most individuals, 31 August for business owners without audit, 31 October for audit cases and companies, and 30 November where a transfer pricing report is needed.
  • A return can be filed late within nine months of the end of the tax year, with a fee.

Whether you must file a return depends on who you are, how much you earned and, since the law now has several non-income triggers, what you did during the year. This post follows section 263 of the Income-tax Act, 2025 and Rules 163 and 164 of the Income-tax Rules, 2026, which apply to tax year 2026-27 (income of FY 2026-27, filed in 2027).

Who must file under section 263(1)

Category Must file a return
Company Always, whether there is income or loss
Firm (including LLP) Always
A university, college or other institution of the kind in section 45(3)(a) Always
Business trust and investment fund Always
A resident (other than a not ordinarily resident) with foreign assets Always, if at any time in the tax year he holds any asset (including a financial interest in an entity) located outside India, has signing authority in an account abroad, or is a beneficiary of such an asset
Any other person (individual, HUF, AOP, BOI and so on) If total income, before the deductions and exemptions named in section 263(1)(a)(iii), exceeds the basic exemption limit
A specified entity (such as a trust) If its total income without applying section 11 exceeds the basic exemption limit
Anyone with a loss If he has a loss under “Profits and gains of business or profession” or “Capital gains” and wants to carry it forward
Persons meeting a prescribed condition See Rule 163 below

The persons in the first five rows and the foreign asset category must file on or before the due date regardless of income or loss (section 263(1)(b)).

The basic exemption limit

The limit is tested on total income before Chapter VIII deductions (such as section 123) and certain capital gains exemptions. A salary of ₹6 lakh with a ₹1.5 lakh section 123 deduction therefore still crosses the limit, and a return is compulsory.

Taxpayer Limit
New regime (section 202) ₹4,00,000
Old regime, below 60 ₹2,50,000
Old regime, resident aged 60 to under 80 ₹3,00,000
Old regime, resident aged 80 or more ₹5,00,000

Rule 163: conditions that make a return compulsory

For a person other than a company or a firm, a return is also required if, in the tax year, he:

  1. deposited more than ₹1 crore in one or more current accounts with a bank or co-operative bank; or
  2. spent more than ₹2 lakh on foreign travel for himself or anyone else (travel to neighbouring countries and notified pilgrimage places is not counted); or
  3. spent more than ₹1 lakh on electricity; or
  4. had business sales, turnover or gross receipts above ₹60 lakh; or
  5. had gross receipts in a profession above ₹10 lakh; or
  6. suffered TDS and TCS of ₹25,000 or more (₹50,000 or more for a resident individual aged 60 or above); or
  7. deposited ₹50 lakh or more in total in savings bank accounts.

Due dates for tax year 2026-27

Section 263(1)(c), as amended by the Finance Act, 2026:

Who Due date
An assessee, including a partner of a firm or the partner’s spouse (where section 10 applies), who must furnish a transfer pricing report under section 172 30 November 2027
A company; any person other than a company whose accounts are required to be audited; a partner of a firm whose accounts are audited, or the spouse of such a partner (not requiring a section 172 report) 31 October 2027
A person with business or professional income whose accounts are not required to be audited, and a partner of a non-audited firm or the spouse of such a partner 31 August 2027
Any other assessee, including salaried individuals 31 July 2027

The 31 August date for non-audited business and professional income was introduced by the Finance Act, 2026 and applies to returns of income of FY 2025-26 as well (due 31/08/2026). A person whose income is mainly from salary, interest and house property still files by 31 July.

Who need not file

  • A person whose total income is below the limit, and who meets none of the conditions above.
  • A class of persons exempted by notification of the Central Government (section 263(3)). For example, certain senior citizens are exempt under a separate rule (see our post on the section 194P exemption).

Filing even when not required

You may want to file voluntarily to:

  • claim a refund of TDS or advance tax;
  • carry forward a loss. Under section 121 a loss that is not determined in a return filed under section 263(1), that is by the due date, cannot be carried forward;
  • keep an income proof for visa, loan or tender purposes.

What happens if you do not file

  • A fee under section 428 (₹1,000 if total income is ₹5 lakh or less, ₹5,000 otherwise) if you file after the due date.
  • Interest under section 423 at 1% a month on the tax unpaid (after advance tax and TDS), from the due date.
  • Loss of the right to carry forward losses (section 121).
  • Difficulty with loans, visas and tenders, where a return is asked for.
  • Possible notice and penalty or prosecution where income was concealed.

See our post on late, revised and updated returns for the time limits and the fee and interest rules.

Which return form

The form depends on your income:

  • SAHAJ (ITR-1): resident individuals (other than not ordinarily resident) with income from salary or family pension, up to two house properties with no loss to carry forward, other sources (not lottery or race horses), and long-term capital gains under section 198 of up to ₹1,25,000, with no brought forward loss. Total income must not exceed ₹50 lakh and there must be no foreign asset, income from abroad, unlisted equity share held at any time, directorship in a company and so on.
  • ITR-2: individuals and HUFs with no business or profession income who are not eligible for ITR-1.
  • SUGAM (ITR-4): residents with business or professional income computed under the presumptive provisions, and who also meet the ITR-1-type limits.
  • ITR-3: individuals and HUFs with business or professional income who cannot use ITR-1, ITR-2 or ITR-4.
  • ITR-5, ITR-6 and ITR-7: other persons, companies, and persons required to file under the provisions for trusts and institutions.

This is a summary of Rule 164. Check the form notified for your year before filing.

Frequently asked questions

Who must file an income tax return?

A company or a firm in every case; any other person whose total income, before specified deductions and exemptions, exceeds the basic exemption limit; anyone who has a business or capital gains loss to carry forward; a resident (other than not ordinarily resident) with an asset or signing authority outside India; and anyone who meets a condition in Rule 163 (section 263(1)).

What is the basic exemption limit for tax year 2026-27?

Under the new regime ₹4,00,000. Under the old regime ₹2,50,000, or ₹3,00,000 for a resident aged 60 to under 80, or ₹5,00,000 for a resident aged 80 or more.

Do I have to file a return if my income is below the limit?

Not necessarily, but you must if any Rule 163 condition applies: deposits of more than ₹1 crore in current accounts, foreign travel spending above ₹2 lakh, electricity bills above ₹1 lakh, business turnover above ₹60 lakh, professional receipts above ₹10 lakh, TDS and TCS of ₹25,000 or more (₹50,000 for a resident senior citizen), or savings account deposits of ₹50 lakh or more.

What is the due date?

31 July after the end of the tax year for most individuals; 31 August for a business owner whose accounts are not audited; 31 October for a company or a person whose accounts are audited; 30 November where a transfer pricing report is required (section 263(1)(c)).

Do I have to file if I have foreign assets but no income?

Yes. A resident who is not a not ordinarily resident and who held any asset, including a financial interest in an entity, located outside India, or has signing authority in a foreign account, at any time in the tax year, must file whatever the income or loss.

Can I file after the due date?

Yes, within nine months from the end of the tax year, or before the assessment is completed if earlier (section 263(4)), with a fee under section 428 and interest under section 423.

Official sources

Related reading

Disclaimer

This article is for general informational purposes only and should not be considered professional advice. Please consult a qualified expert for advice tailored to your specific situation. The author and website owner are not liable for any errors or actions based on this content.