Income Tax Return 2025: How many times can you switch tax regime while filing ITR?
Taxpayers in India can choose between two different regimes while filing their income tax returns — each with a corresponding set of exemptions and benefits. The decision can be revisited annually while filling up the form and the new tax regime remains the ‘default’ if neither is selected on time.
There is no obvious answer when it comes to choosing the right tax regime for each individual — depending on your income, investments and eligible deductions. Salaried individuals opting for the new tax regime will be exempted from paying taxes on income up to Rs 7 lakh for the recently concluded financial year. It offers simplified tax slabs with limited deductions. From FY25 the standard deduction under the new tax regime was raised to Rs 75,000.
Meanwhile the old tax regime allows taxpayers to claim a greater number of deductions and exemptions such as Section 80C, Section 80D, housing rent allowance and more. The standard deduction under this system remains unchanged at Rs 50,000.
According to details outlined on the Income Tax Department website, an individual with non-business income can switch between the old tax regime and new tax regime every year. The old tax regime can only be chosen before the due date of filing the return under section 139(1) of the Income Tax Act.
“An Individual, HUF, AOP (not being co-operative societies), BOI or Artificial Juridical Person with business or professional income will not be eligible to choose between the two regimes every year. Once they opt out of new tax regime, they have only one chance for switching to new regime. Once they switch back to the new regime, they won’t be able to choose old regime anytime in future,” the website adds.
The option of choosing a tax regime is only available when ITR if filed by the due date. Taxpayers filing a belated return will automatically default to the new tax regime. In such cases the income tax portal will not allow a switch to the old regime.