Income-tax Act 2025: What Changed, Which Year It Applies To, and the Full Section Map
Last verified: October 2026, against section pages on incometaxindia.gov.in, the Finance Act 2026 and CBDT’s FAQs on Budget 2026. General information, not personal tax advice.
The Income-tax Act, 2025 replaced the Income-tax Act, 1961 from 1 April 2026. It is mainly a rewrite: the law is shorter, sections are renumbered and many forms have new numbers, but tax rates and most rules are unchanged. This guide explains what changed, which law applies to which year, and maps the sections and forms you are most likely to meet.
Which law applies to which year
| Income earned in | Law | How the year is described | Return due (non-audit individuals) |
|---|---|---|---|
| FY 2025-26 (Apr 2025 – Mar 2026) | Income-tax Act 1961 | Previous year 2025-26 / assessment year 2026-27 | 31 Jul 2026 (ITR-1/2); 31 Aug 2026 for non-audit business cases |
| Tax year 2026-27 (Apr 2026 – Mar 2027) | Income-tax Act 2025 | “Tax year 2026-27” — the separate assessment year concept is dropped | Under Section 263 of the 2025 Act |
What actually changed
- “Tax year” replaces previous year and assessment year. You earn and are taxed in the same named year.
- Sections renumbered and regrouped. For example, 80C is now Section 123, 87A is Section 156 and TDS on salary is Section 392.
- Forms renumbered. Form 16 becomes Form 130, Form 26AS becomes Form 168, Form 15G/15H becomes Form 121.
- Simpler drafting. Many provisos and explanations are replaced by tables and schedules.
- Rates unchanged. The Finance Act 2026 kept the slabs and capital-gains rates; its main changes were elsewhere — for example TCS on education and medical remittances fell to 2% and overseas tour packages now attract a flat 2%.
Section map: 1961 Act → 2025 Act
| Topic | 1961 Act | 2025 Act |
|---|---|---|
| Slab rates / default new regime | 115BAC | 202 |
| Rebate (₹12 lakh) | 87A | 156 |
| Standard deduction, salary perquisites, leave encashment | 16, 10(10AA) | 19 |
| Family pension deduction | 57(iia) | 93 |
| 80C investments (₹1.5 lakh) | 80C | 123 (items in Schedule XV) |
| Employer NPS / extra ₹50,000 NPS | 80CCD(2) / 80CCD(1B) | 124(1)–(2) / 124(3) |
| Health insurance | 80D | 126 |
| Education-loan interest | 80E | 129 |
| Donations | 80G | 133 |
| Rent paid without HRA | 80GG | 134 |
| Savings / deposit interest | 80TTA / 80TTB | 153 |
| Relief for salary arrears | 89 | 157 |
| House-property deductions (incl. ₹2 lakh interest cap) | 24 | 22 |
| Set-off and carry-forward of losses | 70–80 | 108–121 |
| Capital gains exemptions on reinvestment | 54 / 54EC / 54F | 82 / 85 / 86 |
| STCG on listed equity (20%) | 111A | 196 |
| LTCG (12.5%) | 112 / 112A | 198 |
| Presumptive income | 44AD / 44ADA | 58 |
| Return filing, belated and revised returns, updated return | 139(1), 139(4), 139(5), 139(8A) | 263(1), 263(4), 263(5), 263(6) |
| Processing and intimation | 143(1) | 270 |
| Interest for late filing | 234A | 423 |
| Interest on advance tax | 234B / 234C | 424 / 425 |
| TDS on salary | 192 | 392 |
| Other TDS (rent, property, interest and more) | 194 series | 393 |
| TCS (including LRS remittances) | 206C | 394 |
The mapping for HRA (old Section 10(13A)) is not yet clear from the official section pages; employees continue to claim it through the employer, now on Form 124.
Form map
| Old form | New form |
|---|---|
| Form 16 (salary TDS certificate) | Form 130 |
| Form 12BB (employee investment declaration) | Form 124 |
| Form 26AS (annual tax statement) | Form 168 |
| Form 15G / 15H | Form 121 |
| Form 26QB (TDS on property) | Form 141 |
| Form 10E (Section 89 relief) | Form 39 |
| Forms 3CA / 3CB / 3CD (tax audit) | Form 26 |
What you should do now
- Filing for FY 2025-26? Use the 1961 Act sections — 80C, 80D, 87A and so on — exactly as before. Belated returns are due by 31 December 2026; revised returns by 31 March 2027 (with a fee after 31 December).
- Planning for FY 2026-27? Your numbers do not change; expect new section and form numbers on your employer’s declarations and your TDS certificate.
- Reading older guides? Use the table above to translate section numbers.
Related
- Old vs new tax regime FY 2026-27
- Section 87A (now 156) rebate
- Form 16 and Form 130
- Advance tax and Sections 424/425
- Belated and revised returns
FAQs
When did the Income-tax Act 2025 come into force? On 1 April 2026, applying from tax year 2026-27.
Do I use the new section numbers for my FY 2025-26 return? No. Income of FY 2025-26 is assessed under the 1961 Act, so the old section numbers apply.
Did tax rates change with the new Act? No. Slabs, the rebate, the standard deduction and capital-gains rates are unchanged for FY 2026-27.
What is Section 80C called now? Section 123 of the Income-tax Act 2025, with the ₹1.5 lakh limit unchanged.
What replaced Form 16? Form 130, for salary paid from 1 April 2026.
Sources
- Income-tax Act 2025 — section pages on incometaxindia.gov.in.
- Finance Act 2026 (Act No. 4 of 2026).
- CBDT FAQs on Budget 2026.
