New Delhi: A new tax structure has come into effect in the country from April 1, 2026. The government has amended the old Income Tax Act 1961 by implementing the Income Tax Act 2025, which aims to simplify rules and streamline procedures.
Now, the terms ‘financial year’ and ‘assessment year’ will be replaced by simply ‘tax year’.
There have also been changes to ITR filing—the deadline for ITR-1 and ITR-2 remains July 31, while the deadline for ITR-3 and ITR-4 has been extended to August 31. Revised returns can now be filed until March 31, although additional fees will apply for delays.
HRA, Investment and Trading Rules
Claiming House Rent Allowance (HRA) will now require more stringent documentation, such as the landlord’s PAN and proof of rent.
Meanwhile, derivatives trading has become more expensive. The Security Transaction Tax (STT) on options and futures has been increased, increasing costs for active investors.
Tax rules on share buybacks have also changed—they will now be treated as capital gains, not dividends, resulting in a different tax impact on investors.
PAN, Foreign Expenses, and Other Relief
Aadhaar alone will no longer be sufficient to obtain a PAN. Additionally, PAN has been made mandatory for large-scale transactions, such as purchasing a luxury car, hotel payments exceeding ₹1 lakh, and property deals exceeding ₹20 lakh.
Spending abroad has become slightly cheaper. TCS on remittances for travel, education, and medical expenses has been reduced to 2%.
Some relief has also been provided—meal card discounts have been increased to ₹200 per mile, and the tax exemption on gift vouchers has been increased to ₹15,000 annually.
Major changes in daily life
To make digital payments secure, two-factor authentication is now mandatory for UPI and card transactions.
Railway ticket cancellation rules have become stricter—no refunds are now available for cancellations within 8 hours.
The annual FASTag pass has become more expensive, costing ₹3,075. ATM withdrawal rules have also changed—a fee of up to ₹23 per transaction may apply after the free limit.