An assessee will get three more months to file the revised Income Tax Return (ITR) but with fee only. At the same time, the Budget has announced one time scheme for discloser of foreign assets.
“I propose to extend time available for revising returns from December 31 to December 31 with the payment of a nominal fee. I also propose to stagger the timeline for filing of tax returns. Individuals with ITR 1 and ITR 2 returns will continue to file till July 31 and non-audit business cases or trusts are proposed to be allowed time till August 31,” Finance Minister Nirmala Sitharaman said in her Budget speech.
According to the Income tax Department, a fee is imposed on the total income that has been filed during revised return. If the total income filed in the revised return exceeds ₹5 lakh and revised return is filed after 9 month from end of tax year then fee shall be ₹5,000 and if the total income is less than ₹5 lakh then fee shall be ₹1,000.
Disclosure Scheme 2026
“To address practical issues of small taxpayers like students, young professionals, tech employees, relocated NRIs, and such others, I propose to introduce a one-time 6-month foreign asset disclosure scheme for these taxpayers to disclose income or assets below a certain size,” Sitharaman said.
According to the department, the Scheme provides a one-time opportunity to eligible taxpayers to disclose specified foreign income and assets either not taxed or not reported in the return of income, on payment of tax or fee, with immunity from further tax, penalty and prosecution under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
This scheme would be applicable for two categories of taxpayers. First, one who did not disclose their overseas income or asset and second who disclosed their overseas income and/or paid due tax, but could not declare the asset acquired. For first category the limit of undisclosed income/asset is proposed to be up to ₹1 crore. They need to pay 30 per cent of Fair Market Value of asset or 30 percent of undisclosed income as tax and 30 per cent as additional income tax in lieu of penalty and would thereby get immunity from prosecution. For second category, asset value is proposed to be up to ₹5 crore . Here, immunity from both penalty and prosecution will be available with the payment of fee of 1 lakh rupees.
Change in Direct Taxes
- Common Order of assessment, penalty to be passed in certain cases with effect from April 1, 2027
- Granting of immunity under section 440 of the Income-tax Act, 2025 proposed to be expanded to cover cases where penalty proceedings are initiated for under-reporting in consequence of misreporting of income – provided the tax payer pays an additional income-tax as specified in lieu of such penalty
- Maximum punishment for any offences under IT Act 2025 to be brought down 2/3 years from 7 years
- Maximum punishment for offences in case amount of tax involved exceeds ₹50 lakh to be 2 years, 6 months for amount between ₹10-15 lakh. No punishment but just fine in case of offenses with amount up to ₹10 lakh.
