<p>New Delhi, DHNS: The <a href="https://www.deccanherald.com/tags/central-board-of-direct-taxes">Central Board of Direct Taxes (CBDT)</a> on Friday notified the rules for the Income Tax Act, 2025, which will come into effect from April 1.</p><p>The new Act, which was cleared by Parliament in August 2025, seeks to replace the six-decade-old Income Tax Act, 1961, with a simplified framework. </p><p>It removes redundant provisions and archaic language and reduces the number of sections from 819 under the 1961 Act, to 536, while the number of chapters has been cut from 47 to 23.</p><p>It also brings several changes that will impact tax burden and compliance. The new law provides enhanced tax benefit for House Rent Allowance (HRA) to salary-earners, but makes disclosure of landlord-tenant relationship mandatory.</p>.Union Budget 2026 | No changes in income tax slabs, rate; new ITR deadlines, TCS and TDS changes explained .<p>Under the new framework, eight cities — Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru — will qualify for a higher exemption limit of 50% of salary, while all other locations will continue to have an exemption ceiling of 40%. </p><p>Now electric vehicles will also be considered for perquisites taxation and fall within the concessional valuation slab for employer‑provided motorcars.</p><p>Union Finance Minister Nirmala Sitharaman said the new Act must be grounded in a moral and ethical framework. “Income Tax Act, 2025, must be rooted in moral and ethical systems, and replace complexity with clarity, ensuring accountable governance through transparent, rule-based oversight,” she said at an event.</p>
<p>New Delhi, DHNS: The <a href="https://www.deccanherald.com/tags/central-board-of-direct-taxes">Central Board of Direct Taxes (CBDT)</a> on Friday notified the rules for the Income Tax Act, 2025, which will come into effect from April 1.</p><p>The new Act, which was cleared by Parliament in August 2025, seeks to replace the six-decade-old Income Tax Act, 1961, with a simplified framework. </p><p>It removes redundant provisions and archaic language and reduces the number of sections from 819 under the 1961 Act, to 536, while the number of chapters has been cut from 47 to 23.</p><p>It also brings several changes that will impact tax burden and compliance. The new law provides enhanced tax benefit for House Rent Allowance (HRA) to salary-earners, but makes disclosure of landlord-tenant relationship mandatory.</p>.Union Budget 2026 | No changes in income tax slabs, rate; new ITR deadlines, TCS and TDS changes explained .<p>Under the new framework, eight cities — Mumbai, Kolkata, Delhi, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru — will qualify for a higher exemption limit of 50% of salary, while all other locations will continue to have an exemption ceiling of 40%. </p><p>Now electric vehicles will also be considered for perquisites taxation and fall within the concessional valuation slab for employer‑provided motorcars.</p><p>Union Finance Minister Nirmala Sitharaman said the new Act must be grounded in a moral and ethical framework. “Income Tax Act, 2025, must be rooted in moral and ethical systems, and replace complexity with clarity, ensuring accountable governance through transparent, rule-based oversight,” she said at an event.</p>