Form 10-IEA is the form through which an individual, HUF, association of persons (other than a co-operative society), body of individuals or artificial juridical person with income from business or profession leaves the default new tax regime and chooses the old regime, or later comes back to the new regime. A salaried person or pensioner with no business or professional income does not need it: that person chooses the regime in the return itself.
The rule that makes Form 10-IEA different from an ordinary ITR tick-box is the lock-in. A business or professional taxpayer can opt out once and re-enter once. After re-entry, the old regime is closed for good while business income continues. That is why the decision needs a proper tax comparison before the form is filed, not after.
Which law applies to which year
The Income-tax Act, 2025 has applied from 1 April 2026, but returns for income earned in FY 2025-26 are still filed under the 1961 Act. The Department's FAQs on Interplay and Transition to the Income-tax Act, 2025 (Q3.5) state that the ITR for income earned during FY 2025-26 "will be filed for Assessment Year 2026-27 under the provisions of the Income-tax Act, 1961". Income earned from 1 April 2026 to 31 March 2027 belongs to Tax Year 2026-27 under the 2025 Act, with the return due in 2027 (Q3.4). The two are separate compliance obligations with different forms on the e-filing portal (Q3.17).
| Income period | Year label | Law | Regime provision | Return due date provision |
|---|---|---|---|---|
| 1 April 2025 to 31 March 2026 | AY 2026-27 | Income-tax Act, 1961 | Section 115BAC | Section 139(1) |
| 1 April 2026 to 31 March 2027 | Tax Year 2026-27 | Income-tax Act, 2025 | Section 202 | Section 263(1) |
Form 10-IEA itself is a 1961 Act form. The Department's Form 10-IEA page on incometaxindia.gov.in describes it as the form to exercise the option to withdraw from the concessional regime under section 115BAC(1A). That page does not name a corresponding form under the Income-tax Rules, 2026, so for Tax Year 2026-27 check the e-filing portal for the form prescribed under section 202(4) before the due date.
What section 202 of the 2025 Act says
Section 202 of the Income-tax Act, 2025 is headed "New tax regime for individuals, Hindu undivided family and others". Sub-section (1) makes the new regime the default for an individual, HUF, AOP (other than a co-operative society), BOI or artificial juridical person "unless the person exercises the option in the manner provided under sub-section (4)". Sub-section (4) then sets two separate routes.
Person with business or professional income: section 202(4)(a)
- The option must be exercised on or before the due date under section 263(1) for furnishing the return for that tax year.
- Once exercised, the option applies to subsequent tax years as well.
- It "may be withdrawn only once for a tax year other than the tax year for which it was exercised".
- After that withdrawal, the person "shall never be eligible to exercise the option under this sub-section".
Person without business or professional income: section 202(4)(b)
The option is exercised along with the return of income furnished under section 263(1) for the tax year. There is no separate form and no lifetime limit, so the choice can be made afresh every year.
This mirrors the 1961 Act position under section 115BAC. The substance of Form 10-IEA practice therefore carries over; only the section numbers and the year label change.
Who must file Form 10-IEA
The Department's Form 10-IEA FAQs list the eligible filers as an individual, HUF, AOP (other than a co-operative society), BOI and artificial juridical person having income from business or profession. The Form 10-IEA user manual states that it is "mandatory to submit Form 10-IEA for Opt out or Re-entering in to New Tax regime" for these persons. Companies, firms and co-operative societies are outside this form altogether.
The trigger is income under the head business or profession. A freelancer, consultant, doctor, architect, proprietor and a salaried person who also runs a side practice all fall within it. A person with only salary, house property, capital gains or other sources does not.
Due date and what happens if it is missed
For AY 2026-27, the Department's guidance for individuals with business or professional income states that Form 10-IEA must be filed "on or before the due date u/s 139(1)". The FAQs add that a form filed after that date is not valid. In practice this means a taxpayer who files a belated return under section 139(4) cannot choose the old regime for that year; the new regime applies by default.
Under the 2025 Act, the same timing rule is in section 202(4)(a)(i), tied to the section 263(1) due date. File the regime form first and the return afterwards, so that the ITR can refer to the form's acknowledgement.
How many times a business taxpayer can switch
The user manual puts it plainly: the form "can be filed twice in lifetime i.e. one for opt out of new tax regime and one for re-entering in to the new scheme." The AY 2026-27 guidance says re-entry "is available only in subsequent AY and only once in lifetime".
| Situation | Form 10-IEA needed? | Effect |
|---|---|---|
| Business taxpayer happy with the new regime | No | New regime applies by default |
| Business taxpayer wants the old regime for the first time | Yes, opt-out | Old regime applies this year and continues in later years |
| Already opted out, continuing in the old regime | No fresh form | Earlier valid option continues |
| Already opted out, wants to return to the new regime | Yes, re-entry (only once) | New regime applies; old regime closed while business income continues |
| Already re-entered, wants the old regime again | Not permitted | Remains in the new regime |
Revision, withdrawal and verification
The FAQs answer the revision question directly: "No, revision of Form 10-IEA is not allowed. Also, Form 10-IEA, once filed, cannot be withdrawn in same year." A mistaken opt-out cannot be undone for that year; the only way back is the one-time re-entry in a later year, which then closes the old regime permanently. The form is verified through Aadhaar OTP, EVC or DSC.
If a taxpayer who earlier had no business income later starts a practice or business, the FAQs say Form 10-IEA "is required to file within the applicable due date as per section 139(1)" if the old regime is wanted. The earlier year-by-year choice in the ITR does not carry over into a business year.
Comparing the two regimes with real numbers
The Department's AY 2026-27 page gives these slabs for a resident individual below 60. The slab table in section 202 of the 2025 Act for the new regime is the same.
| New regime (default) | Rate | Old regime (below 60) | Rate |
|---|---|---|---|
| Up to ₹4,00,000 | Nil | Up to ₹2,50,000 | Nil |
| ₹4,00,001 to ₹8,00,000 | 5% | ₹2,50,001 to ₹5,00,000 | 5% |
| ₹8,00,001 to ₹12,00,000 | 10% | ₹5,00,001 to ₹10,00,000 | 20% |
| ₹12,00,001 to ₹16,00,000 | 15% | Above ₹10,00,000 | 30% |
| ₹16,00,001 to ₹20,00,000 | 20% | ||
| ₹20,00,001 to ₹24,00,000 | 25% | ||
| Above ₹24,00,000 | 30% | ||
Rebate under section 87A for AY 2026-27 is up to ₹60,000 in the new regime where taxable income does not exceed ₹12,00,000, and up to ₹12,500 in the old regime where taxable income does not exceed ₹5,00,000. The figures below are before surcharge and cess, and "deductions" means amounts allowed only in the old regime.
Example 1: consultant with ₹15 lakh and ₹2 lakh of deductions
- New regime on ₹15,00,000: ₹20,000 + ₹40,000 + 15% of ₹3,00,000 (₹45,000) = ₹1,05,000.
- Old regime on ₹13,00,000: ₹1,12,500 + 30% of ₹3,00,000 (₹90,000) = ₹2,02,500.
The new regime saves ₹97,500. No Form 10-IEA should be filed.
Example 2: professional with ₹11 lakh
New regime tax before rebate is ₹50,000 (₹20,000 + 10% of ₹3,00,000), and the rebate brings it to nil because taxable income is within ₹12,00,000. Even with ₹2,00,000 of deductions, old-regime tax on ₹9,00,000 is ₹92,500 (₹12,500 + 20% of ₹4,00,000). Opting out would cost money.
Example 3: proprietor with ₹30 lakh and large deductions
- New regime on ₹30,00,000: ₹3,00,000 + 30% of ₹6,00,000 = ₹4,80,000.
- Old regime with ₹5,00,000 of deductions (taxable ₹25,00,000): ₹1,12,500 + 30% of ₹15,00,000 = ₹5,62,500. New regime wins.
- Old regime with ₹9,00,000 of deductions (taxable ₹21,00,000): ₹1,12,500 + 30% of ₹11,00,000 = ₹4,42,500. Old regime wins by ₹37,500.
At ₹30 lakh, the break-even is ₹7,75,000 of old-regime deductions: below that the new regime is cheaper. Because the opt-out continues into later years and re-entry is once only, test the comparison on the next two or three years' expected income and deductions too, not just the current year.
Filing Form 10-IEA on the portal
- Log in to the e-filing portal and go to the Income Tax Forms section.
- Select Form 10-IEA, confirm that you have business or professional income and choose the assessment year.
- Complete Basic Information, then Additional Information where applicable, then Declaration and verification.
- Preview, submit and e-verify through Aadhaar OTP, EVC or DSC.
- Keep the acknowledgement number and filing date; the ITR may ask for them.
Pre-filing checklist
- Confirm business or professional income exists for the year. If it does not, choose the regime in the return instead.
- Run both computations on actual income and deductions, and on the expected profile for the next few years.
- Check earlier Form 10-IEA history: an opt-out already on record continues; a re-entry already used means the old regime is closed.
- File before the due date under section 139(1) for AY 2026-27, or section 263(1) for Tax Year 2026-27 onwards.
- Keep the ITR consistent with the valid option and quote the acknowledgement.
Mistakes seen in practice
- Filing Form 10-IEA for a salaried client with no business income.
- Filing a fresh opt-out every year, as if the option lapses annually.
- Using the one-time re-entry for a single low-income year and losing the old regime permanently.
- Filing a belated return and assuming the old regime can still be chosen.
- Filing the form before the comparison is done, given that it cannot be revised or withdrawn in the same year.
Updated on 27 September 2026: added section 202 of the Income-tax Act, 2025 and the AY 2026-27 versus Tax Year 2026-27 split, slab tables, three worked regime comparisons with a break-even figure, a switching table and portal steps.
