Tax return deadline may be extended to March 31

The National Board of Revenue (NBR) is likely to extend the income tax return deadline by another month to March 31, marking the fourth extension this year.

As of yesterday, only 39.08 lakh taxpayers had filed their returns online for the assessment year 2025-26, while nearly three lakh had submitted returns offline, according to NBR data.

In total, only 33.6 percent of the country’s 1.25 crore taxpayer identification number (TIN) holders have filed returns. Last year, around 45 lakh taxpayers submitted their returns.

A senior NBR official, speaking on condition of anonymity, said the board has received multiple requests from stakeholders -- including lawyers, businesspeople and professional bodies -- to extend the current February 28 deadline.

“We are considering at least a one-month extension. A formal order is expected soon, as the proposal has been sent to the finance minister for approval,” the official said.

Explaining the slower submission rate, the official said taxpayers are still adjusting to the mandatory online filing system.

“This year, many people are taking time to get used to mandatory e-return submission. Besides, the national election has also had an impact,” the official added.

NBR officials said several tax lawyers’ associations have sought at least a two-month extension, citing server and network disruptions as well as limited technical skills among taxpayers.

The revenue authority is also considering a year-round return submission system divided into three categories, said a top official. Under the proposal, early filers would get incentives, on-time filers would pay the regular rate, and late filers would face graded penalties.

This year, online filing was made mandatory for almost all individual taxpayers, whereas earlier it applied only to specific groups such as government employees in certain city corporations, and employees of scheduled banks, telecom operators and large private companies.