New Income Tax Bill: Many important income tax amendments have been made in Budget 2025 for the financial year 2025-26 (assessment year 2026-27). These changes have been implemented with the aim of simplifying the tax structure for the taxpayer and making tax compliance easier. It is necessary to do tax planning keeping these changes in mind. So let us know these changes in detail and in easy language.
New tax slabs have been proposed under Section 115BAC in Budget 2025. These slabs will be applicable under the new tax regime (default tax regime).
| Income Tax Slabs (in Rs) | Tax Rate (%) |
| 0 – 4 lakhs | Zero |
| 4 Lakh – 8 Lakh | 5% |
| 8 Lakh – 12 Lakh | 10% |
| 12 Lakh - 16 Lakh | 15% |
| 16 Lakh – 20 Lakh | 20% |
| 20 Lakh – 24 Lakh | 25% |
| More than 24 lakhs | 30% |
The new TDS threshold from 1 April 2025 will be as follows:
| Stream | Earlier Limit (₹) | New Limit (₹) |
| 193 (Interest on securities) | NIL | 10,000 |
| 194A (Other interest income) | ₹ 50,000 (for senior citizens) | ₹ 1,00,000 (for senior citizens) |
| 194B (Lottery Winning) | 10,000 (annual) | ₹ 10,000 (per transaction) |
| 194-I (Rent) | 2,40,000 (annual) | 50,000 (monthly) |
| 194J (Fees for professional services) | 30,000 | 50,000 |
| Stream | Earlier Limit (₹) | New Limit (₹) |
| 206C(1G) (remittance under LRS) | 7 lakh | 10 lakhs |
| 206C(1H) (purchase of goods) | 50 lakhs | Will not be applicable (discount) |
Now the time limit for filing updated tax returns has been increased from 12 months to 48 months (4 years).
ITR-U filing period Additional Taxes
| ITR-U filing period | Additional Taxes |
| within 12 months | 25% |
| within 24 months | 50% |
| Within 36 months | 60% |
| Within 48 months | 70% |
The last date for tax exemption for FSC units has been extended to 31 March 2030, which will provide long-term benefits to investors and businesses. There will be no tax on life insurance policies purchased by foreign investors from IFSC, which will promote international investment. Apart from this, relief has also been given for startups, where startups registered under Section 80-IAC till 1 April 2030 will be given 100% tax exemption for 3 years out of the first 10 years.
Sections 206AB and 206CCA have been removed to simplify the tax system, thereby reducing the complexities of TDS and TCS. The limit for remuneration deduction for partners has also been increased, where a maximum deduction of ₹3,00,000 or 90% (whichever is higher) of book profit up to ₹6,00,000 and 60% of it exceeding ₹6,00,000 will be allowed.
Apart from this, the income of those Unit Linked Insurance Plans (ULIPs) whose annual premium is more than ₹ 2.5 lakh will be taxable under capital gains tax. Relief has also been given in respect of self-occupied properties, now their number will not be limited to two and if the owner is unable to live there for any reason, it will also be considered as zero income.
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PC:prabhatkhabar
