Important Amendments to ITR Filing Rules for the Financial Year 2025–26

🆕 New Tax Regime Becomes the Default

The new tax regime under Section 115BAC is now the default for:

• Individuals

• Hindu Undivided Families (HUFs)

• Associations of Persons (AOPs)

• Bodies of Individuals (BOIs)

• Artificial Juridical Persons

👉 Taxpayers can opt for the old regime by indicating their preference when filing their ITR.

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📊 Revised Income Tax Slabs Under New Regime

Under the new tax regime, income is taxed progressively across defined income brackets:

• No tax is levied on annual income up to ₹4,00,000

• Income from ₹4,00,001 to ₹8,00,000 is taxed at 5%

• The 10% rate applies to income between ₹8,00,001 and ₹12,00,000

• Income between ₹12,00,001 and ₹16,00,000 is taxed at 15%

• A 20% tax is charged on income from ₹16,00,001 to ₹20,00,000

• For income between ₹20,00,001 and ₹24,00,000, the rate is 25%

• Any income exceeding ₹24,00,000 is taxed at 30%

✅ With the standard deduction now increased to ₹75,000, individuals earning up to ₹12.75 lakh annually under the new regime will not have to pay any income tax.

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💸 Enhanced Standard Deduction

The standard deduction has been increased from ₹50,000 to ₹75,000, benefiting salaried individuals and pensioners by reducing their taxable income.

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🔁 Increased Rebate Under Section 87A

With the rebate under Section 87A raised to ₹60,000, individuals earning up to ₹12 lakh under the new tax regime are not liable to pay income tax.

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📈 Higher TDS Thresholds

The thresholds for Tax Deducted at Source (TDS) have been updated:

• The TDS exemption limit on interest income for senior citizens has been raised from ₹50,000 to ₹1 lakh

• The TDS applicability limit on rental income has been revised upward to ₹6 lakh, from the previous ₹2.4 lakh

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🧾 Simplified ITR Forms

The Income Tax Department has rolled out revised ITR forms applicable for AY 2025–26:

• A new Excel utility for ITR-2 was released on March 25, 2025, enhancing the user experience

• A provision under Section 139(8A) enables taxpayers to file revised returns and rectify mistakes after submission

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📋 Summary Table of Key Changes