Income Tax Return 2025: How Many Times Can You Switch Tax Regimes While Filing ITR?

When filing your Income Tax Return (ITR) in India, you have the option to choose between two different tax regimes — the old tax regime and the new tax regime. Both systems have their own benefits, exemptions, and conditions. Choosing the right one depends on your income level, investments, and the deductions you are eligible for. If no option is selected while filing the ITR, the new tax regime will be automatically applied as the default.

Understanding the Old and New Tax Regimes

There is no single answer as to which tax regime is better — it varies based on individual situations.

• New Tax Regime: This system provides lower and simplified tax slabs, but it allows only limited deductions. It is ideal for people who do not claim many exemptions. One of the key benefits is that salaried individuals do not need to pay taxes on income up to ₹7 lakh under the new regime. From the financial year 2024-25 (FY25), the standard deduction under the new regime has been raised to ₹75,000.
• Old Tax Regime: This regime is suitable for those who make use of various deductions and exemptions. It includes benefits like deductions under Section 80C (investments like ELSS, PPF), Section 80D (medical insurance), House Rent Allowance (HRA), and more. The standard deduction under this regime remains unchanged at ₹50,000.

How Many Times Can You Switch Tax Regimes While Filing ITR?

As per the guidelines from the Income Tax Department, individuals with income from salary or other non-business sources are allowed to switch between the old and new tax regimes every financial year. This means you can evaluate which regime works best for you annually and choose accordingly when filing your ITR.

However, this choice can only be made before the due date of filing your return under section 139(1) of the Income Tax Act. If you miss the deadline and file your return late, you lose the option to choose the old regime.

Can Everyone Switch Tax Regimes Annually?

Not everyone is allowed to switch regimes each year. Individuals who earn income from business or profession fall under stricter rules.

According to the Income Tax Department:

• A person with business or professional income can opt out of the new tax regime only once.
• If they choose the old tax regime, they can continue with it in the following years.
• However, if they later decide to switch back to the new regime, they cannot revert to the old regime again in the future.

This means business owners and professionals get only one opportunity to go back to the new regime after opting out — and then they must stick with it.

What Happens If You Miss the Filing Deadline?

The option to choose your tax regime is only available if you file your ITR before the due date.

If you file a belated return, the income tax portal will automatically consider the new tax regime. In such a case, you won’t be allowed to switch to the old tax regime, even if it would have been more beneficial to you.

Read More, Old Tax Regime Vs New Tax Regime - Which Is Better

Conclusion

By understanding the rules and restrictions around choosing tax regimes, you can make better and more informed decisions each year. It’s important to assess your financial situation and compare the benefits under both regimes before making a choice — and to always file your ITR on time to keep all options open.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.                  

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.