CA.Sangam Aggarwal
Quick Summary
Introduction The Income Tax Act, 2025 marks a historic overhaul of India's tax legislation, replacing the 63-year-old Income Tax Act, 1961 with a modern, simplified, and technologically relevant framework. Coming into effect from 1 April 2026, the new Act seeks to remove outdated provisions, consol
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FAQ :
The Income Tax Act, 2025 is a new tax law that modernises India's tax legislation, replacing the Income Tax Act, 1961. It comes into effect from 1 April 2026.
The new Act significantly reduces complexity by almost halving the word count, decreasing the number of chapters and sections, simplifying language, consolidating fragmented provisions, and removing obsolete clauses. It also makes greater use of tables and formulas for easier navigation.
The Income Tax Act, 2025 introduces the 'tax year', a 12-month period within a financial year, which replaces the previous system of 'previous year' and 'assessment year'. This simplifies the primary reference point for taxation.
Tax provisions for Non-Profit Organisations (NPOs) have been consolidated into a single, comprehensive chapter, Part B of Chapter XVII, improving clarity, ease of reference, and compliance for their exemption, registration, and taxation.
No, there are no changes to the due dates for filing income tax returns. The deadlines remain the same as under the previous Act, but the new Act presents these dates in a more accessible, tabulated format.
The Statutory Dispute Resolution Committee (DRC) is a taxpayer-friendly initiative introduced to provide a simple, fast, and low-cost mechanism for resolving small tax disputes, particularly for taxpayers with returned income not exceeding ₹50 lakhs and aggregate variations within ₹10 lakhs.
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