April 1: Credit card rules may change from April 1, know these 5 big updates..

Credit Card Rules: Today, credit cards are not just a means of spending, but have become an integral part of our daily lives. They are used everywhere, whether for shopping, travel, online bill payments, or emergency expenses. With increasing usage, the tax system is also preparing to keep a closer eye on credit card transactions. Under the new draft Income Tax Rules 2026, some major changes may come into effect from April 1, 2026. While these are still proposals, it will be beneficial to be informed in advance.

Credit card rules may change from April 1
Number 1 - Large payments will have to be reported
According to the proposal, if an individual pays a credit card bill of ₹10 lakh or more digitally in a year, banks will report this to the Income Tax Department. Furthermore, if a payment of ₹1 lakh or more is made in cash, that will also be reported. This means that large transactions will now be under direct monitoring.

Number 2 - Card statements will be useful when applying for a PAN
The new rules also propose that credit card statements from the last three months can be accepted as proof of address. This will provide an additional document option when applying for a PAN and could simplify the process.

Number 3 - Convenience in Tax and GST Payments
The draft rules suggest recognizing credit cards as an official electronic means of tax and GST payment. Currently, options such as net banking and debit cards are available. However, additional processing fees may apply when making payments using credit cards, so be sure to check the fees before making a payment.

Number 4 - Rules on Company Credit Cards
If a company provides a credit card to an employee and the company pays the bill, the expense may be taxable. However, if the expense is solely related to official work and proper records are maintained, it may be tax-deductible. Therefore, it will be important to maintain accurate records of such expenses.

Number 5 - PAN Required for New Card
According to the proposal, providing a PAN number may be made mandatory when issuing a new credit card. This will increase transparency in transactions and simplify tax tracking.

All these changes are currently in draft form. They will only be implemented after the final rules are issued. However, it would be wise to understand these potential rules now to avoid any future problems.

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