Income-tax Act, 2025

India's income-tax law for income earned from 1 April 2026. It replaced the Income-tax Act, 1961, in force since 1962, with a rewritten Act of 536 sections. Parliament passed it in August 2025 and it received the President's assent on 21 August 2025.

The first change a reader meets is a word. Under the 1961 Act, the income of a previous year was taxed in the assessment year that followed, so income earned in 2024-25 was assessed in 2025-26. The 2025 Act uses one term, the tax year, which is the financial year starting 1 April in which the income is earned.

Almost every section has a new number, so translate an old reference before you look it up. Tax on long-term gains from listed shares and equity funds was section 112A of the 1961 Act and is section 198 of the 2025 Act. It still charges 12.5% before surcharge and cess, on gains above ₹1.25 lakh a year.

Proceedings for the years before 1 April 2026 are still governed by the old Act. An assessment or an appeal about 2025-26 or earlier follows its sections.

As of October 2026. Check the current text on the Income Tax Department's website before quoting a section.