When it applies
The Income-tax Act, 2025 applies to income earned from 1 April 2026, that is FY 2026-27 onwards. Your return for FY 2025-26, filed in 2026, still follows the 1961 Act.
"Tax year" replaces "previous year" and "assessment year"
The old law taxed the income of a "previous year" in the following "assessment year". The new Act uses one term: the tax year, from 1 April to 31 March. Tax year 2026-27 is the same as FY 2026-27.
Slabs and rates are the same
Budget 2026 kept the slabs and rates from FY 2025-26 under both regimes: the ₹75,000 standard deduction, the 87A rebate up to ₹12 lakh of taxable income in the new regime, and the same surcharge rates.
HRA: eight metro cities
Under the Income-tax Rules, 2026, Bengaluru, Hyderabad, Pune and Ahmedabad join Mumbai, Delhi, Kolkata and Chennai in the 50% HRA group from FY 2026-27. For FY 2025-26, only the four original cities count.
Section numbers change
Most familiar sections have new numbers in the 2025 Act. For example, the cost inflation index for 2026-27 (384) was notified under the new Act. Many people will keep using the old names, like 80C or 87A, for a while, and so do we on this site, alongside the new terms where it helps.
Advance tax
Advance tax for tax year 2026-27 follows the same four dates: 15 June, 15 September, 15 December and 15 March.
What you should do
- File your FY 2025-26 return as usual. If you missed 31 July, you have until 31 December 2026.
- For FY 2026-27, check your regime with your employer, and keep HRA, 80C and other proofs if you choose the old regime.
See your tax for FY 2026-27 under both regimes.
Open the income tax calculatorSources
- Tax rules for salaried individuals, AY 2026-27, Income Tax Department
- Income-tax Rules, 2026 (Notification 22/2026), Central Board of Direct Taxes
- Cost Inflation Index, Income Tax Department
- Due dates for advance tax (FAQs on 234A to 234D), Income Tax Department
This guide explains the rules in general. For your own situation, .