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Direct Tax Servicesvia www.incometax.gov.in

Tax Regime Advisory & Form 10-IC Filing

CA-led old vs new regime comparison and Form 10-IC filing — AY 2026-27 is the last year business-income assessees can choose the old regime. From AY 2027-28, the new regime is mandatory for them.

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STARTING FROM₹1,999
TYPICAL TIMELINE3 days
DOCS REQUIRED2 documents
APPLICABLE TOIndividual, HUF, Sole Proprietor, Partnership Firm, LLP, Professional

Regulatory Framework

Section 115BAC — Income-tax Act, 1961
The new tax regime was introduced by Finance Act 2020 and made the default regime for AY 2024-25 onwards by Finance Act 2023. Under Section 115BAC(6), any individual or HUF with income from business or profession who wants to opt out of the new regime must furnish Form 10-IC before or on the due date for filing the return of income (Rule 44EAA(13) of the Income-tax Rules, 1962).

Section 115BAC(6C) — Finance Act 2026 lock-in
A new sub-section (6C) inserted by Finance Act 2026 provides that an individual or HUF carrying on business or profession income shall not be entitled to opt out of the new regime with effect from AY 2027-28. This makes AY 2026-27 the last assessment year such assessees can exercise the opt-out by filing Form 10-IC.

Form 10-IC
Replaced Form 10-IE (which was used until AY 2023-24). Filed electronically on the income tax e-filing portal (www.incometax.gov.in). Must be filed on or before the due date of the return of income — for non-audit business/profession assessees, this is 31 August 2026 for AY 2026-27.

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ITA 2025 Concordance (in force 1 April 2026)
Section 115BAC [ITA 1961] → Section 202 [ITA 2025] (optional tax regime for individuals, HUFs, AOPs, BOIs, artificial juridical persons)
Transition note: AY 2026-27 runs under ITA 1961 per Section 536(2). ITA 2025 sections apply to tax year 2026-27 onward. From tax year 2026-27, the new regime under Section 202 is the default.

Overview

From AY 2024-25, the new tax regime under Section 115BAC became the default for all individuals, HUFs, and entities with business or profession income. If you want to stay on the old regime — which allows deductions like Section 80C, 80D, HRA, housing loan interest, and business allowances — you must actively elect to opt out by filing Form 10-IC before your ITR due date.

AY 2026-27 is the last year business-income assessees can make this choice. Section 115BAC(6C) (inserted by Finance Act 2026) withdraws the opt-out right from AY 2027-28 onwards for persons with business or profession income. This makes the AY 2026-27 election the final opportunity to lock in old-regime deductions for this class of taxpayers.

What this service includes:

  • Detailed income-tax computation under both regimes (old and new) using your actual income, deductions, and exemptions

  • Identification of deductions that are lost if you switch to the new regime (80C, 80D, 24(b), HRA, LTA, 80CCD(1B), etc.)

  • Recommendation from a Chartered Accountant on which regime results in lower tax outgo for AY 2026-27

  • Filing of Form 10-IC on the income tax e-filing portal before your ITR due date

  • Advice on whether opting out creates a lock-in for subsequent years

Who needs this service:

  • Sole proprietors, professionals (doctors, lawyers, architects, consultants)

  • Partnership firms and LLPs with business income

  • Individuals with freelance, consulting, or trading income

  • Any business-income assessee who has deductions that may exceed the new-regime standard benefit

Key deductions available only in the old regime:

  • Section 80C (₹1.5 lakh: PF, ELSS, PPF, LIC, children's tuition)

  • Section 80D (health insurance premium)

  • Section 80CCD(1B) (NPS additional ₹50,000)

  • Section 24(b) (home loan interest — self-occupied property)

  • HRA exemption under Section 10(13A)

  • Leave Travel Allowance under Section 10(5)

  • Section 80G donations

  • Section 80E education loan interest

  • Section 80TTA/80TTB (interest income deductions for senior citizens)

How It Works

  1. 1

    Share your income details

    Provide your salary/business income, Form 16 or P&L, and details of all deductions (PF, insurance, home loan, rent, donations).

    You do thisSame day
  2. 2

    CA regime comparison

    Our CA runs a side-by-side tax computation under both regimes using your actual figures. We identify the tax saving under each and advise on the optimal choice.

    Harun Raaj & Associates does this1–2 business days
  3. 3

    Confirm regime choice

    You review the computation and confirm which regime to elect. We explain the lock-in implications — especially the AY 2027-28 mandatory new-regime rule for business income.

    You do thisSame day
  4. 4

    File Form 10-IC

    We file Form 10-IC on the income tax e-filing portal before your ITR due date. You receive the acknowledgement.

    Harun Raaj & Associates does thisSame day
  5. 5

    ITR filed under elected regime

    Your income tax return is filed under the regime you selected, with all eligible deductions claimed (if old regime) or the standard deduction (if new regime).

    Harun Raaj & Associates does this1–3 business days

Frequently Asked Questions

What is Form 10-IC and who needs to file it?
Form 10-IC is the form prescribed under Rule 44EAA(13) of the Income-tax Rules, 1962 that an individual or HUF carrying on business or profession income must file if they want to opt out of the new tax regime under Section 115BAC and continue on the old regime. If you do not file Form 10-IC, your return will be processed under the new regime by default.
Is AY 2026-27 really the last year I can choose the old regime?
Yes, for assessees with business or profession income. Section 115BAC(6C), inserted by Finance Act 2026, withdraws the right to opt out of the new regime from AY 2027-28 onwards for persons with business or profession income. AY 2026-27 is therefore the final assessment year where the opt-out is available for this class.
What is the deadline to file Form 10-IC for AY 2026-27?
Form 10-IC must be filed on or before the due date for filing the return of income. For non-audit business and profession assessees, the due date for AY 2026-27 is 31 August 2026. For assessees requiring tax audit, the due date is 31 October 2026.
If I filed Form 10-IE earlier, do I need Form 10-IC now?
Form 10-IE was the older opt-out form used up to AY 2023-24. From AY 2024-25, Form 10-IC replaced Form 10-IE for business/profession assessees. If you opted out in prior years using 10-IE, you are generally bound by that election; however, you should confirm the current position with your CA, especially if your business or professional income status has changed.
Which regime is better for me — old or new?
It depends on your eligible deductions. The new regime offers lower slab rates but disallows most deductions (80C, 80D, HRA, housing loan interest). The old regime retains all deductions but has higher slab rates. If your deductions exceed roughly ₹3.75 lakh (for income up to ₹15 lakh), the old regime is usually better. A CA-prepared computation is the only reliable way to determine this for your specific income profile.
What happens if I miss filing Form 10-IC by the due date?
If you do not file Form 10-IC before the ITR due date, your return will be processed under the new tax regime. You will lose old-regime deductions for that year. There is no condonation mechanism for a missed Form 10-IC election — the deadline is strict.

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