The Income Tax Department has notified new Income Tax Rules, 2026, effective April 1, 2026, marking a transition to the Income Tax Act, 2025. Key changes include revised motor car perquisite valuations, increased tax-free loan limits to ₹2 lakh, and updated HRA rules. The new regime focuses on simplification and stricter compliance, with the tax filing deadline for AY 2025-26 extended to September 15, 2025.
Key Income Tax Updates (As of March 2026):
- New Tax Act 2025: The old Income Tax Act of 1961 is repealed, replaced by the Income Tax Act, 2025, effective April 1, 2026.
- Income Tax Rules, 2026: Notified by the Central Board of Direct Taxes (CBDT), these rules focus on strengthening disclosures and streamlining procedures.
- Key Rule Changes: The tax-free loan limit increased to ₹2 lakh, and there are revisions to HRA benefits and motor car perks.
- TDS/TCS Corrections: Corrections for FY 2018-19 (Q4) through FY 2023-24 (Q3) must be filed by March 31, 2026.
- PRARAMBH 2026: The department launched a nationwide awareness campaign to familiarize taxpayers with the new Act, according to the Income Tax India X handle.
- Return Filing Extensions: The deadline for filing Returns for AY 2025–26 was extended to September 15, 2025.
- Bank Reporting Stricter: Banks must comply with amended rules requiring more detailed reporting of account holders and controlling persons, including self-certification, as noted on the PDICAI website
Key Income Tax Updates (As of March 2026):
- New Tax Regime Default: For FY 2025-26, the new, streamlined tax regime is the default, notes ClearTax.
- Major Form Overhaul: Nearly 30 commonly used forms, including those for tax audits (3CA/3CB replaced by Form 26) and TDS, have been updated under the Income Tax Rules 2026.
- Restaurant Crackdown: Following a nationwide investigation, the tax department found ₹408 crore in suppressed sales at restaurants.
- International Reporting Changes: Rule 114-G has been updated to require more detailed reporting for non-U.S. accounts, including e-money and Central Bank Digital Currencies (CBDC)
- Pending Returns/Refunds: As of February 2026, over 24.64 lakh ITRs for the 2025-26 assessment year are pending for over 90 days, say YouTube news sources.
- Old Tax Regime Savings: Despite the shift to the new regime, some taxpayers may find better savings under the old regime,
