Income-tax Act, 2025: what changes for taxpayers from 1 April 2026
The Income-tax Act, 1961 has been replaced. For most individuals and businesses the tax itself changes little, but the vocabulary, section numbers and form numbers have all moved. Here is what to know before your next filing.
By Ryan Vaz, FCA · · 6 min read
The Income-tax Act, 2025 came into force on 1 April 2026 and replaces the Income-tax Act, 1961, which had been amended so many times over six decades that it had become difficult to read. The new Act is shorter and reorganised, but the government's stated intent was simplification rather than a new tax policy. Rates, slabs and most deductions carry over.
That makes the change easy to underestimate. The substance is familiar, but almost every reference point a taxpayer or practitioner uses, from section numbers to form names, is different.
One 'tax year' instead of previous year and assessment year
Under the 1961 Act, income earned in a 'previous year' was assessed in the following 'assessment year'. Income for April 2025 to March 2026 was FY 2025-26 and AY 2026-27. The two-year label confused many taxpayers.
The 2025 Act uses a single 'tax year'. The year from 1 April 2026 to 31 March 2027 is tax year 2026-27, and income for that year is reported and assessed as tax year 2026-27. There is no separate assessment year.
Returns being filed during 2026 are still for FY 2025-26 (AY 2026-27), because that income was earned while the 1961 Act was in force. The new terminology applies fully from income earned on or after 1 April 2026.
Sections and forms have new numbers
The 2025 Act has been renumbered from start to finish. Many TDS provisions that were spread across separate sections, such as 194-IA for property purchases or 195 for payments to non-residents, are now grouped within a single section with a table of payments. Advisers, software and bank forms are all updating to the new references.
Forms have been renumbered too. Some of the most frequently used, as reported in published mappings, are below. Check the e-filing portal for the current form before filing, as rules and forms continue to be notified.
| Familiar name (1961 Act) | Purpose | New form |
|---|---|---|
| Form 26AS | Annual tax credit statement | 168 |
| Form 16 | TDS certificate for salary | 130 |
| Form 16A | TDS certificate for other payments | 131 |
| Form 24Q | Quarterly TDS statement for salary | 138 |
| Form 26Q | Quarterly TDS statement for other payments | 140 |
| Form 15CA | Declaration for remittance abroad | 145 |
| Form 15CB | Chartered accountant's certificate for remittance | 146 |
Return due dates
For FY 2025-26, the Finance Act, 2026 moved the due date for taxpayers with business or professional income who are not subject to audit, typically filing ITR-3 or ITR-4, from 31 July to 31 August. Salaried and other individuals filing ITR-1 or ITR-2 remain at 31 July. For audit cases, CBDT has extended the return due date from 31 October to 21 November 2026, and the tax audit report from 30 September to 21 October 2026. Transfer pricing cases are not covered by that extension and remain at 30 November.
A belated return for FY 2025-26 can be filed up to 31 December 2026. A return already filed can be revised up to 31 March 2027, with a fee if it is revised after 31 December 2026.
What stays the same
- Residential status tests for individuals, including the 182-day, 60-day and 120-day rules, and RNOR status
- The structure of the old and new tax regimes, with the new regime as the default
- Advance tax instalment dates: 15 June, 15 September, 15 December and 15 March
- TDS deposit by the 7th of the following month, and quarterly TDS statements
- Annual Information Statement and the tax credit statement as the department's view of your income
What to do now
For most individuals, the practical steps are modest. Use the 'tax year' language for income earned from April 2026, make sure your accounting and payroll software has been updated for new TDS references and forms, and treat any older article that quotes section numbers with care. Businesses that deduct TDS should confirm that challans, statements and certificates are being generated in the new formats.
See the compliance calendar for upcoming due dates under both Acts.
This article is general information based on the law as understood on 19 October 2026. Rules, thresholds and form numbers change, and the facts of each case matter. It is not professional advice.