Draft rules, forms under new I-T law likely this week for consultation

Draft rules and forms under the Income Tax Act, 2025 are set to be released this week, ahead of a phased transition from the 1961 law starting April 1

The draft rules and prescribed forms under the newly enacted Income Tax Act, 2025 are likely to be made public this week for stakeholders’ consultation, a senior finance ministry official said.

 

After considering the inputs, the government will make necessary changes, if required, and notify the final rules, he added.

 

“Only thereafter will the income tax portal be updated with new online facilities, including simplified e-filing modules, application forms, validation tools, and tracking options,” the official added. Meanwhile, there would be some overlapping periods for the new and old income tax Acts, he stated. 

“It is necessary because the new law applies prospectively to income earned from tax year 2026-27. All past assessment years, ongoing proceedings, revisions, rectifications, appeals, and compliances will continue under the old 1961 Act,” the official added. 

According to experts, as the new Act will come into force from April 1, taxpayers will have to adapt quickly, as compliance requirements will apply from day one. “For instance, in the case of remittances, forms such as 15CA and 15CB will need to be filed immediately. Similarly, in TDS-related matters, taxpayers may have to obtain certificates in advance, such as lower deduction certificates, right from the start. Given the limited time available, it will be difficult for taxpayers to fully understand the new provisions. The transition will be challenging, but it is an integral part of the reform process and will require flexibility from all stakeholders,” said Ved Jain, former president of the Institute of Chartered Accountants of India (ICAI).

 

Chetan Daga, partner, AdvantEdge Consulting, said this consultative approach provides a robust opportunity for tax professionals and taxpayers to understand the rules and forms, compare them with the existing rules to understand changes therein, and also provide feedback to the government for any inconsistencies or drafting discrepancies. “These collective partnering efforts shall assist towards the intended objective of simplification of the tax regime under the upcoming Income Tax Act, 2025,” Daga added.