New income tax return forms ask for more details, simplify capital gains filing

India’s income tax return ecosystem is undergoing one of its biggest structural transitions in recent years, with the revised ITR forms for Assessment Year 2026-27 incorporating several compliance and reporting changes aligned with the amended capital gains framework, enhanced digital verification requirements and the government’s push toward technology-driven tax administration.

The Central Board of Direct Taxes (CBDT) has rolled out sweeping changes across ITR-1 to ITR-4, impacting salaried taxpayers,

investors, professionals, traders and presumptive taxpayers.

The revised forms simplify several capital gains disclosures introduced after the July 2024 tax amendments, while simultaneously expanding data capture around donations, political contributions, contact information and business disclosures.

“The widening of reporting requirements in the ITR forms is intended to align taxpayer disclosures with data already available with the government from multiple sources. The rationale is to strengthen transparency and enable risk-based verification by the tax department, while giving compliant taxpayers greater certainty and reducing post-filing queries and litigation,” said Richa Sawhney.

Bigger Push Toward Data-Linked Compliance

One of the clearest themes across the revised forms is deeper taxpayer profiling and data integration.

Across multiple forms, taxpayers will now be required to furnish:

• primary and secondary mobile numbers and email IDs,


• primary and secondary addresses.

The move is aimed at improving taxpayer traceability, communication and verification while enabling better analytics-based scrutiny.

Additional financial disclosures, such as mandatory bank balance reporting and investment disclosures, have also been introduced in select forms such as ITR-4.

The revised forms also reflect the government’s broader move toward faceless and digitally driven tax administration.

ITR-1: Relief for Salaried Taxpayers With Two House Properties

The biggest change in ITR-1 (Sahaj) is the expansion of eligibility for resident individuals earning income from up to two house properties, compared with only one property earlier.

The revised house property schedule has also become significantly more detailed, requiring disclosure of:

• property address,


• ownership percentage,


• co-owner details,


• tenant information,


• PAN/Aadhaar/TAN of the tenant.

The revised form also:

• removes separate reporting for overseas retirement benefit accounts under Section 89A,


• introduces representative assessee reporting,


• adds a new disclosure for fee under Section 234I for delayed revised returns.

The changes are expected to benefit salaried taxpayers with modest property portfolios who earlier had to migrate to more complex forms.

ITR-2: Capital Gains Reporting Simplified for Investors

ITR-2, widely used by high-income salaried taxpayers and stock market investors, has undergone significant restructuring to align with the revised capital gains framework.

The separate disclosure requirement for gains earned before and after July 23, 2024 is no longer applicable in AY 2026-27.

The revised form now reflects the rationalised capital gains tax structure introduced through the Finance Act amendments.

Other major changes include:

• granular interest income reporting for interest earned from companies, NBFCs and HFCs,


• separate disclosure for certain non-resident income taxable at 9% under Section 115A read with Section 194LC,


• mandatory transaction reference numbers and IFSC details for Section 80G donations,


• expanded political contribution disclosures requiring political party name and PAN.

Tax professionals say the changes indicate the government’s growing focus on traceable digital transactions and political funding transparency.

ITR-3: Businesses, Traders and Professionals Face Wider Reporting

Among all forms, ITR-3 has perhaps seen the most substantial expansion.

The revised form now separately captures:

• Futures & Options trading turnover and income,


• presumptive income disclosures for non-resident businesses,


• granular tax regime selection history,


• expanded political contribution disclosures requiring political party name and PAN,


• disability-type disclosures under Sections 80DD and 80U.

The form also removes several legacy capital gains reporting bifurcations introduced after the July 2024 changes.

The revised form further reflects the extended non-audit filing deadline framework, with August 31 now appearing as a due-date option.

The revised Form 10-IEA reporting structure now seeks additional disclosures regarding prior filings, re-entry into the new regime and current-year regime selection.

ITR-4: Simpler Form, Wider Data Capture

ITR-4 (Sugam), used by individuals, HUFs and firms other than LLPs opting for presumptive taxation, has also been expanded.

Like ITR-1, the revised form now supports reporting for up to two house properties.

The form additionally:

• mandates reporting of bank balances under business financial particulars,


• introduces an “Investments” field under business financial particulars,


• realigns Form 10IEA reporting requirements,


• introduces Section 234I fee reporting,


• removes overseas pension-related disclosures.

Compliance professionals say the form is becoming more data-oriented despite continuing as a simplified return mechanism for taxpayers under the presumptive taxation scheme.