India e-Filing April 03: ITR-1 Eases Two-Home Reporting for AY 2026-27

India’s e filing season for AY 2026-27 opens with a practical win for salaried taxpayers. ITR-1 now permits reporting income from up to two house properties, cutting form-switching and errors. The e filing portal also supports a revised ITR-7 for exempt entities, improving visibility. These AY 2026-27 forms matter for cash flow planning, refunds, and compliance before the July 31, 2026 deadline. We explain what changed, who benefits, and simple steps to file on time.

What Changed for AY 2026-27

Effective April 3, CBDT enabled AY 2026-27 e filing and expanded ITR-1 to cover income from up to two house properties. This reduces friction for salaried users who previously shifted to ITR-2 only for a second home. The change is confirmed by mainstream coverage that highlights relief for two-home earners source.

You cannot use ITR-1 if your total income exceeds ₹50 lakh, you have capital gains, business income, foreign assets, or more than two house properties. NRIs remain outside its scope. Those taxpayers should continue with ITR-2 or ITR-3. For most salaried residents with simple income mixes, e filing ITR-1 now covers two homes without extra schedules or migration.

How to Report Two Homes in ITR-1

Choose the correct status for each property: self-occupied, let out, or vacant. Report rent received, municipal taxes paid, and interest on home loans. The Section 24(b) interest deduction remains, while overall set-off for loss from house property stays capped by law. Clear, consistent numbers help the e filing system match Form 26AS, AIS, and TIS without manual checks.

Log in to the e filing portal, pick AY 2026-27, and select ITR-1. Use pre-fill for PAN, employer, and TDS. Under “Income from house property,” add Property 1 and Property 2, fill address, occupancy type, rent, taxes, and interest. Validate, compute tax, preview, and e-verify via Aadhaar OTP, net banking, or DSC. Early e filing supports quicker processing and refunds.

Revised ITR-7 and Governance

ITR-7 now asks for sharper reporting by charitable and religious trusts, funds, and institutions. Boards should expect deeper disclosure on income application, accumulations, and donation streams. The update is part of the notified AY 2026-27 forms aimed at better transparency and comparability across filings source.

Maintain reconciled ledgers for grants, donations, and corpus movements. Map PAN-quoting donors, foreign receipts, and bank credits to schedules before e filing. Ensure compliance with registration validity and audit reports. Early dry runs on the e filing portal reveal gaps in pre-fill, AIS, or bank mapping. Clean, timely ITR-7 submissions reduce queries and speed up exemption-related confirmations.

Investor Angle and Deadlines

Capturing a second home in ITR-1 lets us reflect actual interest deductions and rent adjustments in one place. That improves TDS reconciliation and may reduce mismatches. Timely e filing lowers chances of interest under Sections 234A and 234B. For households paying EMIs and rent, better data in a single return smooths monthly budgeting and refund expectations.

The non-audit due date is July 31, 2026. Start e filing once Form 16, AIS, and TIS are ready, and pre-validate your bank account. Keep loan interest certificates, rent receipts, and municipal tax proofs. Verify return on the same day to speed processing. If you expect a refund, submit early, keep contact details updated, and track status on the e filing portal.

Final Thoughts

The AY 2026-27 update makes e filing easier and clearer. ITR-1 now covers income from up to two house properties, removing the need to switch forms for many salaried users. Revised ITR-7 raises the bar for disclosures by exempt entities, which should improve trust and audit readiness. Our action plan is simple: gather Form 16, interest certificates, rent and tax records, and reconcile AIS and TIS before you start. File on the e filing portal early, verify quickly, and keep your bank account pre-validated. If you fall outside ITR-1 limits, move to ITR-2 or ITR-3 without delay. Clean data and timely e filing help reduce notices and speed refunds.

FAQs

Who can use ITR-1 for AY 2026-27 after the change?

Resident individuals with total income up to ₹50 lakh from salary, pension, one or two house properties, and other income like interest can use ITR-1. You must not have capital gains, business income, foreign assets, or be an NRI. More than two houses still requires ITR-2 or ITR-3.

How do I report two houses correctly in ITR-1?

In the house property section, add each property, select status as self-occupied, let out, or vacant, and enter address, annual rent, municipal taxes, and loan interest. Keep documents ready and match details with AIS and TIS. Validate, compute tax, preview, and complete e filing with e-verification.

Does the ₹2 lakh house property loss cap still apply in ITR-1?

Yes. The inter-head set-off of loss from house property against other income remains capped at ₹2 lakh in a year. Any remaining loss can be carried forward as per law if conditions are met. Ensure interest certificates and rent records support the numbers you enter during e filing.

What changed in ITR-7 for AY 2026-27?

ITR-7 seeks more granular disclosures from trusts and exempt entities. Expect clearer reporting on application of income, accumulations, and donation streams. Boards should reconcile grants and donor details before e filing, verify registrations and audit reports, and run early checks to reduce queries and speed confirmations.

Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.