ITR Filing Guide 2025-26: New vs Old Tax Regime — Deductions, Process & Deadlines

Disclaimer: This is an educational guide based on publicly available Income Tax Department data. It does not constitute personalized tax advice. Consult a Chartered Accountant (CA) for your specific situation.

Filing your Income Tax Return (ITR) is a legal obligation for every individual earning above the basic exemption limit in India. For FY 2025-26 (Assessment Year 2026-27), the New Tax Regime is the default, but you can opt for the Old Regime at the time of filing.

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1. Should You Choose Old or New Tax Regime?

The fundamental question is: Do your deductions exceed ₹3.75 Lakhs? If yes, the Old Regime may save you more.

Income Slab	New Regime Tax Rate	Old Regime Tax Rate
Up to ₹3,00,000	NIL	NIL
₹3,00,001 – ₹7,00,000	5%	5%
₹7,00,001 – ₹10,00,000	10%	20%
₹10,00,001 – ₹12,00,000	15%	30%
₹12,00,001 – ₹15,00,000	20%	30%
Above ₹15,00,000	30%	30%

New Regime Advantage: ₹25,000 Standard Deduction (Budget 2024 enhanced) + zero tax up to ₹7 Lakhs effective income (87A rebate).

Old Regime Advantage: You can claim HRA, 80C (₹1.5L), 80D health insurance (₹25,000–₹1L), LTA, home loan interest (₹2L), NPS 80CCD(1B) (₹50,000 additional), and other deductions.

Quick Decision Rule

If (Standard Deduction + All 80C + 80D + HRA + Home Loan Interest) > ₹3.75L
  → Old Regime is better
Else
  → New Regime is simpler & likely better

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2. Key Deductions Under Old Tax Regime (What You Can Claim)

Section 80C (Max ₹1,50,000)

Eligible investments include:

• EPF employee contribution
• PPF deposits (₹500 – ₹1.5L/year)
• ELSS mutual fund SIP (3-year lock-in, market returns)
• Life insurance premium (LIC, term plans)
• Principal repayment of home loan
• NSC, 5-year bank FD, Sukanya Samriddhi

Section 80D — Health Insurance Premium

Premium For	Self-Employed	Salaried
Self + Family (Below 60)	₹25,000	₹25,000
Parents (Below 60)	+ ₹25,000	+ ₹25,000
Senior Citizen Parents	+ ₹50,000	+ ₹50,000

HRA (House Rent Allowance)

HRA exemption = Minimum of:

1. Actual HRA received
2. 50% of Basic Salary (Metro) / 40% (Non-Metro)
3. Rent Paid − 10% of Basic Salary

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3. ITR Form Selection Guide

Your Income Type	Which ITR Form
Salary + Bank Interest (< ₹50L total)	ITR-1 (Sahaj)
Salary + House Property + Capital Gains	ITR-2
Business / Freelance / Consulting Income	ITR-3 or ITR-4
Only Capital Gains from stocks/MF	ITR-2

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4. How to File ITR Online (Step by Step)

1. Login at incometax.gov.in using PAN + Aadhaar OTP.
2. Go to: File → File Income Tax Return → AY 2026-27.
3. Select: Online Mode → Choose your ITR form (ITR-1 for salaried).
4. Pre-fill data: Portal auto-fills Form 16 data, AIS (Annual Information Statement), and TIS.
5. Verify AIS: Cross-check income, TDS, dividends, and interest from AIS with your actual figures.
6. Enter Deductions: Claim 80C, 80D, HRA manually under relevant sections.
7. Compute Tax: Portal calculates tax payable or refund due.
8. Pay Tax: If any tax liability remains, pay via Challan 280 using net banking.
9. Submit & e-Verify: Verify via Aadhaar OTP, Net Banking, or DSC. Verification is mandatory within 30 days of filing.

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5. Important Deadlines (FY 2025-26 / AY 2026-27)

Deadline	Who	Date
ITR Filing (No Audit Required)	Salaried / Non-Audit	31 July 2026
ITR Filing (Audit Required)	Business Owners	31 October 2026
Belated ITR (with penalty ₹1,000–₹5,000)	Everyone	31 December 2026

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6. Common Mistakes to Avoid

• Mismatching Form 26AS & AIS: Always verify TDS credits match your Form 16.
• Forgetting bank interest income: Savings bank and FD interest must be disclosed under "Income from Other Sources".
• Not claiming 87A rebate: Under both regimes, if total income is under ₹7L (new) or ₹5L (old), full tax is rebated to zero.
• Missing capital gains: LTCG above ₹1 Lakh from equity MFs or stocks must be reported, even if you don't owe tax.

Related Tools: Use the Income Tax Calculator on Learntrix to estimate your FY 2025-26 tax liability before filing.