With the Income Tax Return (ITR) filing season underway, taxpayers are evaluating whether the old or new tax regime would be more beneficial for them. While salaried individuals can switch between the two regimes every year, the rules are different for those earning income from business or profession, including taxpayers who opt for the presumptive taxation scheme.The Income Tax Department has already enabled ITR filing for the financial year 2025-26 (assessment year 2026-27) by releasing the Excel utilities for ITR-1 and ITR-4 forms on the e-filing portal. Before filing returns, presumptive taxpayers should understand the tax regime switching rules and their implications.What Is the Presumptive Taxation Scheme?The presumptive taxation scheme is designed to simplify tax compliance for small businesses, professionals and freelancers. Under this scheme, taxpayers can declare income as a fixed percentage of their turnover without maintaining detailed books of accounts.The scheme is governed by Sections 44AD and 44ADA of the Income-Tax Act and aims to make return filing easier while offering significant tax-saving opportunities for eligible taxpayers.Those opting for presumptive taxation are required to report their income under the "Profits and Gains from Business or Profession" category while filing returns through the ITR-4 (Sugam) form.ALSO READ: Got Form 16 From Your Employer? Check These Key Details Before Filing Your ITR This YearFive-Year Lock-In RuleOne of the most important conditions under the presumptive taxation scheme is the five-year continuity requirement. Taxpayers who opt for the scheme are generally expected to continue with it for five consecutive years. Exiting the scheme before completing this period may restrict re-entry for the next five years.Additionally, taxpayers under the presumptive scheme must pay their advance tax liability in a single instalment on or before March 15 of the financial year.Can Presumptive Taxpayers Switch Between Tax Regimes?Yes, presumptive taxpayers can choose between the old and new tax regimes. However, unlike salaried individuals, they do not have the flexibility to switch every year.Taxpayers with business or professional income filing returns through ITR-3, ITR-4 or ITR-5 can move out of the default new tax regime by filing Form 10-IEA. However, this choice is subject to specific conditions and may not be available again.For example, consider a freelancer who is currently under the default new tax regime. If he later decides that the old tax regime is more beneficial, he can switch to the old regime by filing Form 10-IEA. However, once he makes this switch, he cannot move back to the new tax regime while continuing to earn business or professional income.This makes the decision particularly important for business owners, freelancers and professionals, as unlike salaried individuals, they do not have the flexibility to switch between the two tax regimes every year. As a result, the decision to opt out of the new tax regime should be taken carefully, considering its long-term tax implications. ALSO READ: ITR Filing 2026-27: Key Deadlines Salaried, Business And Audit Taxpayers Must Know