ITR filing 2026: Can professionals and business owners change their tax regime every year?

The new tax regime is now the default option for taxpayers, but salaried individuals can still choose between the old and new tax regimes every year based on which one helps them lower their tax liability.

The rules, however, are more restrictive for taxpayers with business or professional income. While they can opt to change their tax regime, they cannot do so as frequently as salaried individuals.

How often can business owners, professionals change their tax regime?

Taxpayers with business or professional income filing ITR-3, ITR-4 (under the presumptive taxation scheme), or ITR-5 can opt out of the default new tax regime and vice versa by filing Form 10-IEA.

However, unlike salaried taxpayers, this option can be exercised only once. This means if that if a taxpayer switches from the new tax regime to the old tax regime, they cannot opt for the new tax regime again as long as they continue to have business or professional income.

The same rule and process applies to presumptive taxpayers as well. The presumptive taxation scheme allows freelancers, professionals and small businesses to declare income as a fixed percentage of their turnover without requiring to maintain detailed books of accounts.

This crucial caveat makes the decision to opt out of the new tax regime an important one, as it may have long-term tax implications.

When is the ITR deadline for business owners and professionals?

The income tax return (ITR) deadline for business owners and professionals for Assessment Year 2026-27 (FY 2025-26) depends on whether a tax audit is required or not. Here are the due dates applicable in different cases:

• October 31, 2026 for tax audit cases (ITR-3) and presumptive taxpayers liable for tax audit (ITR-4).
• December 31, 2026 for taxpayers filing belated return, meaning those filing return after the original due date.

You can complete your filing via the income tax department e-filing portal by logging in using your user ID and password.

Should you choose the new or old tax regime?

A taxpayer is generally advised to choose an income tax regime based on their income profile and what would benefit them the most. This choice significantly impacts your tax liability, so it’s essential to understand the differences.