The Income Tax Return (ITR) filing season for Assessment Year 2025–26 is now underway, although belatedly. The Income Tax Department was slow to release the ITR forms and schema and hence, it has suo moto extended the due date for filing ITRs by non-auditable assessees to 15th September 2025. It appears that the ITR forms this year have significant changes; hence, the date has been extended by such a margin. Further, whatever forms have already been released show the same signs.
Most of the additional information being sought in the Income Tax returns this year applies to taxpayers who wish to claim the deductions under the Old Regime. The main purpose of asking for such information is to thwart that category of taxpayers who have been making bogus deduction claims. With these details, the Income Tax Department would digitally verify the authenticity of the claims.
1. To claim an exemption for House Rent Allowance (HRA) under Section 10(13A), taxpayers must now furnish more detailed information in their income tax returns.
Details required include:
• Work City: The city where you are employed, which is crucial as HRA exemption limits differ based on whether the city is classified as metro or non-metro.
• Actual HRA Received: The total HRA amount received from your employer during the financial year.
• Rent Paid: The total rent actually paid during the year for residential accommodation. This directly affects the HRA exemption calculation.
• Basic Salary plus Dearness
Allowance (DA): The sum of your basic salary and DA forms the basis for computing the exemption, as it is capped at a percentage of this amount.
• Metro/Non-Metro Classification: You must clearly indicate whether your work city falls under the “metro” (e.g., Delhi, Mumbai, Chennai, Kolkata) or “non-metro” category. Metro city residents are eligible for up to 50% of basic + DA as exemption, while non-metro residents can claim up to 40%.
2. Section 80C Deduction – New Disclosure Requirements
For claiming deductions under Section 80C—which includes investments like PPF, EPF, life insurance premiums, ELSS, home loan principal repayment, tuition fees, etc.—taxpayers are now required to provide identifiable details for each item. This change aims to enable direct verification of the investments claimed.
• Policy or Document Identification Number: For every investment or policy under 80C, you must provide a unique identifier. For example:
- Life insurance – Policy number
- PPF – Account number
- ELSS – Folio number
3. Section 80D – Health Insurance Deduction
To claim a deduction under Section 80D for health insurance premiums, more specific details must now be disclosed to validate the policy and insurer.
• Name of Insurer: The full legal name of the health insurance company (e.g., HDFC ERGO, Star Health, ICICI Lombard).
• Policy Number or Reference
Number: The unique identifier for the policy, used for verification.
4. Section 80E – Education Loan Interest
To avail of the deduction for interest on education loans under Section 80E, taxpayers must provide comprehensive loan details. This ensures the deduction pertains to a legitimate loan from a recognised lender.
• Name of the Lender/Bank: The full name of the financial institution granting the loan.
• Loan Account Number: The specific account number associated with the education loan.
• Sanction Date: The date on which the loan was approved and disbursed.
• Original Loan Amount: The initial principal sanctioned.
• Outstanding Balance as of 31 March: The unpaid principal amount at the end of the financial year.
The above are some of the common deductions claimed by taxpayers under the old regime, and how the Income Tax Department is trying to tighten the screws on those taxpayers who were claiming bogus deductions. Genuine taxpayers have nothing to worry about, but they will have to start collecting the above additional information so that they can file a complete and timely income tax return.
(The writer, a Fellow Chartered Accountant (FCA), specialising in Goods, Services tax, Transfer Pricing and Income tax, is the co-author of the book ‘Comedium of Industrial Policy for MSMEs in Goa’ released by ICAI)
