The government has extended the ITR filing deadline for AY 2025-26 to September 15, 2025, giving taxpayers additional time to comply with their obligations. While this extension brings relief to individuals and businesses, a critical issue remains: less than 40% of returns have been processed so far, even though the filing window has been open for nearly three months.
While this extension brings relief to individuals and businesses, a critical issue remains less than 40% of returns have been processed so far. Platforms like AuditFiling can help taxpayers simplify incometaxefiling compliance and avoid last-minute hassles by offering guided ITR filing support.
According to the income tax department site, since May 29, 2025, the official start of this year’s ITR filing, around 3.29 crore returns have been filed. Out of these:
3.19 crore returns have been verified by taxpayers.
Only 1,13,66,260 verified returns have been processed by the department.
This means that while filing and verification numbers are high, the return processing rate is just about 35%, leaving a significant backlog. For many taxpayers, this delay could also impact refund settlements.
The original deadline for non-audit taxpayers was July 31, 2025. However, the Finance Ministry announced on May 27 that the last date to file ITRs would be extended to September 15, 2025, offering an additional 46 days.
Extensive Changes in ITR Forms
For AY 2025-26, the government introduced structural and content revisions in ITR forms.
These changes aim to simplify compliance, enhance transparency, and improve accuracy in reporting.
System Readiness
The new forms required more time for system development, integration, and testing.
The delay in the rollout of utilities made it difficult for taxpayers to start filing early.
Stakeholder Concerns
Chartered accountants, industry bodies, and taxpayers highlighted issues such as ITR 26AS mismatches, AIS discrepancies, and filing glitches.
The extension was a response to these concerns, ensuring fairness in compliance.
The ITR filing process this year began on a delayed note.
The Excel utilities for ITR-1 and ITR-4 were released only on May 29, almost two months late compared to the usual timeline.
Over time, utilities for ITR-1 to ITR-6 have been released.
However, ITR-7 utilities (both online and offline) are still pending. Entities such as trusts, NGOs, and political parties that rely on ITR-7 are unable to proceed with filing.
The Excel utility for ITR-6 was released just last week, further compressing the available time for corporate taxpayers.
This staggered release of utilities has not only delayed filing but also slowed down the return processing rate, creating a ripple effect across the compliance cycle.
ITR utilities are structured digital interfaces that taxpayers use to itr return file online or offline. They:
Provide schema validation to minimize filing errors.
Integrate with third-party accounting software.
Enable e-verification and submission of forms.
Are typically released in phases starting with simpler forms such as ITR-1 and ITR-4, followed by more complex ones like ITR-3, ITR-5, ITR-6, and ITR-7.
Every year, the release of ITR utilities is a crucial step in enabling taxpayers to begin their compliance process. Any delay in utilities impacts not only taxpayers but also the government’s ability to process returns on time.
Late utility rollout compressed both income tax itr file and processing windows.
System integration challenges arose from the structural changes in forms.
Verification backlogs built up due to millions of returns being filed within a short span.
Pending ITR-7 utilities mean that certain categories of taxpayers haven’t even begun their filing process yet.
As a result, although 3.29 crore returns are already filed, only about 1.13 crore returns have been fully processed.
Extended Deadline: Non-audit taxpayers have until September 15, 2025 to file their ITRs.
Processing Delays: With less than 40% processed so far, taxpayers should expect refund delays.
Pending Utilities: Entities required to file ITR-7 must wait until the government releases the utility.
Early Filing Recommended: Even with the ITR extended deadline, filing early can help avoid last-minute technical glitches.
Use Trusted Platforms: Filing through reliable services such as audit filing can reduce errors, ensure timely compliance, and speed up refund processing.
The extension of the ITR filing deadline AY 2025-26 provides much-needed relief to taxpayers. However, the fact that less than 40% of returns are processed highlights deeper issues with system preparedness and utility rollout. For smoother compliance and timely refunds, taxpayers are advised to file early, complete verification promptly, and track processing status regularly.
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