'Launch of NUDGE campaign to encourage taxpayers to voluntarily review deduction claims': CBDT
In a notification issued on December 23, 2025, the tax authority said advanced risk analytics under its risk management framework have identified several cases for Assessment Year (AY) 2025–26 where deductions or exemptions appear to have been wrongly claimed.
- Dec 23, 2025,
- Updated Dec 23, 2025 6:33 PM IST
The Central Board of Direct Taxes (CBDT) said it has launched a data-driven NUDGE campaign for AY 2025–26 to prompt taxpayers to voluntarily review deduction and exemption claims flagged as potentially ineligible through risk analytics. It clarified that the outreach is advisory in nature and reflects a trust-first approach, allowing taxpayers to make voluntary corrections wherever necessary.
In a notification issued on December 23, 2025, the tax authority said advanced risk analytics under its risk management framework have identified several cases for Assessment Year (AY) 2025–26 where deductions or exemptions appear to have been wrongly claimed.
According to the CBDT, these include instances of bogus donations made to registered and unrecognised political parties, incorrect claims of deductions or exemptions, and cases where either incorrect PANs or invalid PANs of donees were quoted in income tax returns. In some situations, errors were also found in the quantum of deduction or exemption claimed, leading to understatement of income.
To address these issues without resorting to intrusive enforcement, the tax department has reached out to identified taxpayers through SMS and email under its “Non-intrusive Usage of Data to Guide and Enable (NUDGE)” campaign. Taxpayers have been advised to review their income tax returns and voluntarily correct any incorrect claims by filing revised returns on or before December 31, 2025.
The CBDT said the initiative reflects a trust-based approach to tax administration, giving taxpayers an opportunity to self-correct errors and ensure compliance. The campaign leverages technology and data analytics to create a transparent, taxpayer-friendly environment focused on guidance rather than immediate scrutiny.
The response so far has been significant. During FY 2025–26, over 21 lakh taxpayers have already updated their returns for AYs 2021–22 to 2024–25, resulting in additional tax payments exceeding ₹2,500 crore. For the current assessment year, more than 15 lakh income tax returns have already been revised.
The tax authority clarified that taxpayers whose deduction or exemption claims are genuine and correctly made in accordance with the law need not take any action. However, those who fail to respond within the prescribed timeline can still file an updated return from January 1, 2026, as permitted under law, though this would involve additional tax liability.
The CBDT has advised taxpayers to act promptly to avoid future inquiries or penalties.
How to review, rectify bogus claims
Check for CBDT alerts: Look out for SMS, emails, or portal notifications sent since December 12, 2025, flagging high-risk claims, especially under Sections 80G and 80GGC.
Review donation deductions: Verify all donations claimed to charities or political parties, ensuring recipient eligibility, correct PAN details, approved payment modes, and matching documents.
Spot risky claims: Watch for non-operational entities, doubtful receipts, cash or unapproved payment methods, or missing disclosures in your return.
Correct the return: File a revised return for AY 2025–26 or an updated return (ITR-U) for earlier years to withdraw or correct errors and pay due tax.
Update contact details: Ensure your registered email and mobile number on the e-filing portal are accurate to avoid missing compliance alerts.
The Central Board of Direct Taxes (CBDT) said it has launched a data-driven NUDGE campaign for AY 2025–26 to prompt taxpayers to voluntarily review deduction and exemption claims flagged as potentially ineligible through risk analytics. It clarified that the outreach is advisory in nature and reflects a trust-first approach, allowing taxpayers to make voluntary corrections wherever necessary.
In a notification issued on December 23, 2025, the tax authority said advanced risk analytics under its risk management framework have identified several cases for Assessment Year (AY) 2025–26 where deductions or exemptions appear to have been wrongly claimed.
According to the CBDT, these include instances of bogus donations made to registered and unrecognised political parties, incorrect claims of deductions or exemptions, and cases where either incorrect PANs or invalid PANs of donees were quoted in income tax returns. In some situations, errors were also found in the quantum of deduction or exemption claimed, leading to understatement of income.
To address these issues without resorting to intrusive enforcement, the tax department has reached out to identified taxpayers through SMS and email under its “Non-intrusive Usage of Data to Guide and Enable (NUDGE)” campaign. Taxpayers have been advised to review their income tax returns and voluntarily correct any incorrect claims by filing revised returns on or before December 31, 2025.
The CBDT said the initiative reflects a trust-based approach to tax administration, giving taxpayers an opportunity to self-correct errors and ensure compliance. The campaign leverages technology and data analytics to create a transparent, taxpayer-friendly environment focused on guidance rather than immediate scrutiny.
The response so far has been significant. During FY 2025–26, over 21 lakh taxpayers have already updated their returns for AYs 2021–22 to 2024–25, resulting in additional tax payments exceeding ₹2,500 crore. For the current assessment year, more than 15 lakh income tax returns have already been revised.
The tax authority clarified that taxpayers whose deduction or exemption claims are genuine and correctly made in accordance with the law need not take any action. However, those who fail to respond within the prescribed timeline can still file an updated return from January 1, 2026, as permitted under law, though this would involve additional tax liability.
The CBDT has advised taxpayers to act promptly to avoid future inquiries or penalties.
How to review, rectify bogus claims
Check for CBDT alerts: Look out for SMS, emails, or portal notifications sent since December 12, 2025, flagging high-risk claims, especially under Sections 80G and 80GGC.
Review donation deductions: Verify all donations claimed to charities or political parties, ensuring recipient eligibility, correct PAN details, approved payment modes, and matching documents.
Spot risky claims: Watch for non-operational entities, doubtful receipts, cash or unapproved payment methods, or missing disclosures in your return.
Correct the return: File a revised return for AY 2025–26 or an updated return (ITR-U) for earlier years to withdraw or correct errors and pay due tax.
Update contact details: Ensure your registered email and mobile number on the e-filing portal are accurate to avoid missing compliance alerts.