Ahead of the Union Budget on February 1, 2026, the Institute of Chartered Accountants of India (ICAI) has submitted a game-changing proposal to the Finance Ministry. The goal is to move beyond simple data pre-filling and introduce a fully automated Income Tax Calculator Utility directly on the e-filing portal.
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This tool would not just show your data, but calculate your final tax liability using real-time information from Form 26AS and the Annual Information Statement (AIS).
1. How the Proposed “Auto-Calculator” Would Work
Currently, taxpayers see their income in AIS but must manually calculate taxes or use third-party apps. The ICAI’s proposed system would:
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Pre-fill Everything: Pull salary, interest, and dividend data from your AIS/26AS.
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Instant Computation: Automatically calculate the Total Taxable Income and Tax Liability without manual entry.
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“Accept & Pay” Feature: Provide a simple “Accept” button. If you agree with the system’s math, you can pay and file instantly.
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2. The “Shield Against Scrutiny”
Perhaps the most significant part of the proposal is the protection from tax notices.
ICAI Suggestion: If a taxpayer accepts the system-generated calculation and pays the tax accordingly, their return should not be subject to scrutiny under Section 270(10) of the new Income Tax Act, 2025 (corresponding to the old Sec 143(3)).
This would provide a “Safe Harbour” for honest taxpayers, giving them certainty that their returns won’t be reopened for questioning later.
3. Simplifying the “Tax Regime” Choice
ICAI has also suggested a major administrative fix for the New vs. Old Regime debate:
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No More Separate Forms: Currently, opting out of the new regime requires filing a separate form.
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ITR-Integrated Choice: ICAI proposes that the option to select the regime should be part of the ITR form itself, removing an extra layer of compliance and reducing errors.
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