New Delhi: Union Finance Minister Nirmala Sitharaman while presenting her ninth subsequent Upkeep in the parliament on Sunday spoken that the new Income Tax Act will come into effect from April 1, 2026.
What did the Finance Minister say?
The new Income Tax act, which will replace the six-decade-old tax law, was spoken by the Union Finance Minister and said that simplified income tax rules and forms will be notified shortly.
During her Upkeep speech, Nirmala Sitharaman said that, "This (direct tax code) was completed in record time and the Income Tax Act 2025 will come into effect from first April 2026. The simplified income tax rules and forms will be notified shortly, giving unobjectionable time to taxpayers to warn themselves with its requirements."
What else did she propose?
The Finance Minister during her speech moreover proposed to reduce the TCS (Tax Collected at Source) rate from current 5 per cent to 2 per cent for education and medical education under the Liberalised Remittance Scheme (LRS).
Nirmala Sitharaman moreover proposed to reduce the TCS rate on the sale of overseas tour packages. The rate will be cut from the current 5 per cent and 20 per cent to 2 per cent.
"I propose to reduce TCS rate on the sale of overseas tour program package from the current 5 per cent and 20 per cent to 2 per cent without any stipulation of amount," she said.
What well-nigh the Motor Wrecking Claims Tribunal?
During the upkeep speech, Nirmala Sitharaman moreover proposed that interest awarded by the Motor Wrecking Claims Tribunal to a natural person will be exempted from income tax, and any TDS on this will moreover be washed-up yonder with.
FM Sitharaman said, "I propose that any interest awarded by the motor wrecking claims tribunal to a natural person will be exempt from income tax and any TDS on this worth will be washed-up yonder with."
What is the deadline to file ITR?
The Finance Minister moreover said that the deadline for filing of income tax (I-T) return has been revised from December 31 to March 31, on payment of nominal fee.
"We propose a rule-based streamlined process for small taxpayers in FY27 Budget. People filing ITR-1 and ITR-2 can protract to file till July 31. Non-audit merchantry cases and trusts will be unliable to file returns till August 31," she said.
She moreover said that "now as a person you can file revised ITR by March 31 with a nominal fee".
