Last updated: April 2026

Indian income tax is the direct tax levied by the Central Government on the annual income of individuals, Hindu Undivided Families (HUFs), companies, firms, and other entities. It is administered by the Income Tax Department under the Central Board of Direct Taxes (CBDT).

The new Income-tax Act, 2025. Parliament has enacted the Income-tax Act, 2025, which replaces the six-decade-old Income-tax Act, 1961. The new Act is a structural rewrite — simpler drafting, consolidated sections, and "tax year" terminology in place of the previous-year / assessment-year split — without major changes to the rate structure or core charging provisions for individuals. References to old section numbers (80C, 80D, 24(b), 87A, 195, etc.) are still in common use during the transition; the new Act renumbers many of these. Always check both the old and new section numbers when responding to a notice or filing for FY 2025-26 onward.

Key facts:

Two regimes for individuals: the new regime (lower slab rates, almost no deductions, default option) and the old regime (higher rates but deductions like 80C, 80D, HRA, 24(b) available).

Section 87A rebate under the new regime makes taxable income up to ₹7 lakh effectively tax-free for resident individuals.

ITR forms: ITR-1 for simple salary income up to ₹50 lakh, ITR-2 for capital gains/foreign income (no business), ITR-3 for business and profession, ITR-4 for presumptive taxation under 44AD/44ADA/44AE.

Filing deadline: 31 July for non-audit cases; 31 October for audit cases.

Advance tax is mandatory if liability exceeds ₹10,000, payable in four instalments (15%, 45%, 75%, 100%) by 15 June, 15 September, 15 December, and 15 March.

Example. A salaried Bengaluru employee with ₹14 lakh CTC, ₹1.5 lakh in 80C, ₹25,000 in 80D, and ₹2.4 lakh annual rent typically pays less under the old regime once HRA is factored in. Above ~₹3.5–4 lakh of total deductions, the old regime usually beats the new regime; below that, the new regime is simpler and cheaper.

Related: income tax estimator (/calculators/income-tax-estimator), Tax Planning Strategies (/glossary/tax-planning-strategies-revised-tax), ReviseTax services (/service)