As the New Income Tax, 2025, applied from April 1, 2026, and the tax year (TY) replaced the assessment year (AY), many taxpayers are confused if they need to file two Income Tax Returns (ITRs), one for AY 2026-27 and another for TY 2026-27, for income earned during the Financial Year 2025-26. The Income Tax (I-T) Department in a guideline book called Kar Setu has replied to that query along with many other questions that taxpayers may face while filing their ITR for FY 2025-26 in the transition year (FY 2026-27) of the Income Tax Act.
Replying to the answer whether taxpayers need to file two ITRs for AY 26-27 and TY 26-27 during the transition year of FY 26-27, the Income Tax Department said in the Kar Setu document, “No. The obligation to file the return for the Tax Year 2026-27 will arise after the end of the Tax Year, and it is similar to the framework existing in Income Tax Act, 1961.
