Income tax return (ITR) filings are expected to increase by 8-10 percent in AY 2026-27, extending the steady growth seen in recent years as greater taxpayer awareness, wider reporting through the Annual Information Statement (AIS), Tax Deducted at Source (TDS) disclosures and continued formalisation of income bring more individuals into the tax net, according to tax experts.
The expected increase follows a steady rise in return filings over the past four assessment years. ITR filings increased from 5.83 crore in AY 2022-23 to 6.77 crore in AY 2023-24 and 7.29 crore in AY 2024-25. The trend continued in AY 2025-26, with over 7.3 crore returns filed by September 15, 2025, (the due date was extended till September 16, 2025).
An Tax expert, expects ITR filings to grow by around 8-10 percent this year. He said taxpayers are increasingly aware that the Income Tax Department has access to financial information through various reporting mechanisms. As a result, more individuals understand that filing an ITR may be mandatory even if their income is below the basic exemption limit when they undertake specified high-value financial transactions.
Experts said the expected growth will be driven by greater formalisation of income, wider TDS and TCS reporting, improved visibility through the Annual Information Statement (AIS) and easier online filing. “Filings should continue to grow, in line with the steady rise we have seen over the past few years. The formalisation of income, better data reporting through AIS and TDS, and easier online filing keep bringing more people into the system every year,” another tax expert said.
However, some experts expect an even sharper increase in return filings.
Another tax expert estimates ITR filings could rise by 12-15 percent year-on-year. He attributed the expected growth to enhanced tax relief under the new tax regime, simplified return filing, faster processing of returns and quicker refunds, all of which have encouraged greater voluntary compliance.
The filing momentum has continued even after the due date. According to a written reply in the Rajya Sabha, around 8.80 crore ITRs had been filed for AY 2025-26 till February 4, 2026.
Against this backdrop, another tax expert, expects the total number of ITRs filed in AY 2026-27 to move closer to 9.5 crore to 10 crore, provided the filing momentum continues and the income tax portal remains stable.
More taxpayers likely to shift to ITR-2 and ITR-3
Apart from the increase in the number of returns, experts expect a shift towards more complex return forms as investment income becomes more common.
Experts say more taxpayers now earn income from stocks, mutual funds, futures and options (F&O) trading and side businesses in addition to salary. As a result, a growing number of taxpayers are expected to move from simpler forms such as ITR-1 to ITR-2 and ITR-3.
“The more interesting change is in the kind of returns being filed. More Indians now have income beyond salary, from stocks, mutual funds, F&O trading and side businesses. That means more filers are moving from simple forms like ITR-1 to ITR-2 and ITR-3. The higher rebate threshold has also left more disposable income in people’s hands, and a lot of it is going into markets and small ventures. So the real trend to watch is not just how many Indians file, but how much more complex the average return is becoming,” he said.
Experts also advised taxpayers not to confuse the filing deadlines. While the due date for ITR-1 and ITR-2 is July 31, ITR-3 and ITR-4 have time till August 31. Taxpayers should file well before the deadline instead of waiting until the last minute.
