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The Union Budget 2026 has introduced major changes to India’s direct tax system. If you have been worried about getting income tax notices or facing strict scrutiny there is some good news for you. Budget 2026 offers relief by giving taxpayers more time to file revised returns. It also introduces simpler and more friendly rules to reduce stress and make paying taxes easier for everyone. Why Have Tax Notices Become So Common? With greater use of technology by the Income-tax Department to identify mismatches in taxpayers’ filings automated notices such as AIS/TIS or NUDGE alerts have become rampant. These notices are generated when there is a mismatch in the information reported by the taxpayer and what is available with the Income-tax Department from third-party sources such as employers banks mutual funds etc. Taxpayers have been receiving notices even for small errors such as claiming one extra deduction under Section 80C or forgetting to report bank interest. Such regular notices have caused panic among salaried taxpayers and professionals alike. File Revised Returns Anytime Until End of Assessment Year This is one of the biggest amendments announced in Budget 2026. Earlier taxpayers could file revised returns to rectify errors only until 3 months prior to the end of the relevant assessment year. Now taxpayers will be allowed to file revised returns up until the end of the relevant assessment year. This will provide taxpayers with additional time to correct errors in their returns. Although there will be a small fee for filing revised returns this amendment gives much-needed relief to taxpayers. Filing fees have been capped at ₹1000 for individuals with income upto ₹5 lakh and ₹5000 for all other taxpayers. However this is a small price to pay considering you can avoid hefty penalties in the future by making the necessary changes to your return. Also read: Budget 2026 Income Tax Rule Changes: Hidden tweaks late ITR fees and immunity from prosecution; check all details you shouldn’t miss Ability to File Updated Return Even After Receipt of Notice Under Assessment This amendment allows taxpayers to file an updated return even after they receive a notice for reassessment. Prior to this amendment taxpayers were not allowed to make any changes to their returns once a notice had been issued. For instance if the Income-tax Department issued a notice to reassess your income under Section 148 you would not be allowed to file an updated return. Now taxpayers will be allowed to make any changes to their returns after they receive a notice from the Income-tax Department as long as the period to reply to the notice has not expired. Essentially this allows taxpayers to “ voluntarily disclose” the correct information and avoid punishment. Immunity from Prosecution The Budget also eases the penalty and prosecution regime. Taxpayers who disclose their misreported/under-reported income and pay the due tax and interest will now not face any penalties or criminal prosecution. This amendment also applies to any misreporting of income where the Income-tax Department has initiated action for reassessment or scrutiny. Overall the new provisions provide a huge relief to taxpayers. Also Read: 8th Pay Commission Big Update: Central government employees threaten protest after budget 2026 announcement - What’s the reason?