India is implementing several new financial and regulatory rules starting Wednesday, April 1, as the new financial year 2026-27 (FY27) begins, impacting citizens across the country.
New Income Tax Act 2026
India’s six-decade-old tax framework under the Income Tax Act, 1961 will be replaced by the newly introduced Income Tax Act, 2025 on April 1, marking a significant overhaul of the country’s direct tax system. The Act has removed redundant provisions and archaic language, introducing simpler language for common people.
The Act also renames Assessment Year (AY) and Financial Year (FY) to Tax Year, to avoid confusion. It retains the existing slab rates for salaried individuals, businesspersons, professionals and other taxpayers.
Impact on Take-Home Salary
Companies will now have to pay at least 50% of an employee’s salary as the basic wage component under the ‘wages’ section of the four new labour codes. This change will increase provident fund contributions, effectively reducing in-hand salary.
Changes to House Rent Allowance (HRA) rules and new ticketing reforms introduced by Indian railways are also expected to impact taxpayers.
Changes to TDS and Banking Practices
Form 130 will officially replace Form 16 as the primary Tax Deducted at Source (TDS) certificate for senior citizens and salaried employees from FY 2026–27 onwards. Employers will issue the certificate to salaried individuals, and specified banks to eligible senior citizens. Issuance of this certificate is mandatory by June 15 of the financial year, once TDS is deducted and deposited.
HDFC Bank will now charge ₹23 per transaction on UPI cash withdrawals at ATMs after five free transactions. Banks will also make other new changes to crucial tasks such as ATM cash withdrawal limits.
Discover more from Archyworldys
Subscribe to get the latest posts sent to your email.
