Big Tax Relief In Budget 2026, ITR Deadline Extended To July 31, TCS Cut To 2% And Relief For Students Studying Abroad

New Delhi: Finance Minister Nirmala Sitharaman has announced major relief for small taxpayers in Budget 2026. During her budget speech, she said the government will introduce a new tax scheme to make tax filing easier and reduce the compliance burden.

The main aim of this move is to simplify the tax system and help taxpayers file their returns without confusion. This new scheme is expected to benefit salaried individuals, small professionals, and first-time taxpayers.

The government believes that easier rules will encourage more people to file their income tax returns on time and honestly.

ITR Filing Deadline Extended

One of the most important announcements is related to the Income Tax Return (ITR) deadline.

The due date for filing ITR-1 and ITR-2 has now been extended to July 31. This gives taxpayers more time to prepare their documents and file returns properly.

Earlier, many taxpayers used to face pressure due to limited time, system issues, and lack of clarity. With this extension, millions of people will now get extra time and mental relief.

This decision is especially helpful for salaried employees, pensioners, and individuals with simple income sources.

Relief for Students Studying Abroad

The government has also given relief to families sending money abroad for education.

Earlier, TCS (Tax Collected at Source) on foreign education remittances was 5 percent. Now, the government has reduced it to 2 percent.

This means families will now pay less tax while transferring money for overseas studies. This will reduce the financial burden on students and parents who are already spending heavily on tuition fees, accommodation, and living expenses.

What Is the Impact of These Decisions?

These announcements are seen as very positive for small taxpayers and the middle class.

The new tax scheme will make compliance simpler. The extended ITR deadline will help taxpayers avoid mistakes and penalties. The lower TCS will support students aiming for higher education abroad.

Overall, these steps show that the government is trying to make the tax system more taxpayer-friendly and less stressful.

Experts believe this will improve trust between taxpayers and the tax department, and encourage voluntary compliance.

Published on: Sunday, February 01, 2026, 01:48 PM IST