Income Tax FY 2026-27

*New this year (effective April 1, 2026):

• The New Income Tax Act 2025 is now in effect — replacing the 1961 Act
• Tax slabs and rates are unchanged for FY 2026-27

 

Tax-free income limits:

• New Regime: Up to Rs.12 lakh (Rs.12.75 lakh for salaried with standard deduction)
• Old Regime: Up to Rs.5 lakh

 

ITR filing deadlines AY 2026-27:

• Salaried / ITR 1 & 2: July 31, 2026
• Non-audit businesses / trusts: August 31, 2026

 

Key decisions every taxpayer must make:

1. New Regime vs Old Regime — choose before your employer deducts TDS

2. Which 80C investments to use (if opting Old Regime)

3. Whether to file yourself or use an assisted service

Under the Income Tax Act 2025 (effective April 1, 2026), you are required to file an Income Tax Return (ITR) if any of the following apply:

• Your annual income exceeds Rs.2.5 lakh under the Old Tax Regime, or Rs.3 lakh under the New Tax Regime, before deductions
• You have income from more than one source — salary, rent, freelance, capital gains, or interest income combined
• Tax was deducted at source (TDS) from your salary or fixed deposit interest and you want to claim a refund
• You have foreign assets or overseas income to declare
• You need an official income record for a home loan, visa application, or credit card

Even if your income falls below the taxable limit, filing a return is a smart financial habit. Lenders, visa consulates, and landlords increasingly ask for 2-3 years of ITR acknowledgements.

Budget 2026 confirmed no changes to income tax slabs. The following rates apply for the full financial year.

New Tax Regime (Default Regime):

Section 87A rebate: Rs.60,000 — makes taxable income up to Rs.12 lakh effectively tax-free under the New Regime.

Standard deduction (salaried): Rs.75,000 — making gross salary up to Rs.12.75 lakh effectively tax-free.

4% Health and Education Cess applies to all taxpayers on their final tax liability.

 

The single most consequential income tax decision you make each year is choosing your tax regime. Here is the practical guide to making it correctly.

 

 

CHANGED:

• The governing legislation: New Income Tax Act 2025 replaces the Income Tax Act 1961 — same rules, simpler language

• Terminology: 'Financial Year' and 'Assessment Year' are now unified as 'Tax Year'

• Revised return deadline extended to March 31 (was 9 months from end of tax year)

• TCS on overseas tour packages reduced to a flat 2% (was 5%/20%)

   

UNCHANGED:

• Tax slabs and rates for FY 2026-27

• Rs.12 lakh effective tax-free income under the New Regime

• Section 80C investment limit of Rs.1.5 lakh

• ITR filing deadline: July 31, 2026 for individuals (ITR 1 & 2)

Every ‘person’, be it natural or artificial, as defined in Section 2(3) of the Income Tax Act of 1961, must pay tax. The tax authorities divide them into the following categories:

• Individuals 

• Hindu Undivided Families (HUFs)

• Association of Persons (AOPs)

• Body of Individuals (BOIs)

• Firms, LLPs, and Companies

• Local authority

• Any other artificial juridical person

The Income Tax Department is a government agency that undertakes the duty of collecting direct tax in India. Every operation of this department is handled by CBDT (Central Board for Direct Taxes). 

You can visit their official website to garner information on international taxation, tax laws and rules, organisational setup, etc.

The ITR status facility is available in two ways:

• Pre-Login

• Post-Login

 

Both options are fairly simple, much like the process of paying tax online, and you can follow the guides below.

Follow the steps below if you opt for the pre-login facility to check your ITR status online:

1. Go to the new ITR e-Filing portal (www.incometax.gov.in/iec/foportal/)

2. On the homepage, select Income Tax Return (ITR) status

3. Enter your Acknowledgement Number and registered mobile number to continue

4. You will receive a six-digit OTP on your registered number. Enter it and select ‘Submit’

5. On successful validation, you will be able to view your ITR status online

Follow the steps below if you opt for the post-login facility to check your ITR status online:

1. Log in to the new income tax website or the IT e-Filing portal (www.incometax.gov.in/iec/foportal/) using your credentials

2. Select the option ‘e-File’ > ‘Income Tax Returns’ > ‘View Filed Returns’

3. On the ‘View Filed Returns’ page, you will be able to view all the returns you have filed historically

 

You can also browse through the various tax-saving tools available on Bajaj Markets. The investment options available on our platform not only allow you to save on tax but also secure your financial future.