Income Tax Bill 2025 Ends Refunds for Late ITR Filers

The new Income Tax Bill 2025, set to take effect in FY 2026-27, has raised concerns among taxpayers regarding their eligibility for refunds if they file their Income Tax Returns (ITR) late. Currently, under the Income Tax Act of 1961, taxpayers can file belated returns until December 31 and still claim refunds. However, the proposed bill stipulates that refunds can only be claimed if returns are filed by the due date, significantly altering existing provisions. Despite widespread anxiety over this change, the Income Tax Department has clarified that refund provisions remain unchanged, allowing claims even for late filings under certain sections. Experts and taxpayers have expressed confusion over these rules, prompting the department to reaffirm that the overall refund process will not be impacted by the new bill. This situation underscores the importance for taxpayers to understand their rights and the implications of the upcoming legislative changes.