New income tax rules: From this day on, all tax accounting will change! These 4 major changes have been made in the new income tax law..

New Income Tax Act: A major chapter is about to be added to India's tax history. The central government has decided to consign the 64-year-old Income Tax Act, 1961, to the pages of history. A completely new, modern, and simplified income tax law will be implemented in the country from April 1, 2026. The government clearly believes that the complexities of the old law had confused the average taxpayer, and now it's time for a change. This new change will directly impact your pocket, your investment habits, and the way you file returns. The new law emphasizes transparency, but some rules have also been tightened. Let's understand the major changes that will impact the lives of the common man.

Major Changes in the Tax Calendar
The biggest confusion when filing income taxes was the calculation of the years. Taxpayers often got confused between the "previous year" (the year in which income was earned) and the "assessment year" (the year in which taxes were paid). This terminology was quite complicated in the 1961 law.

The new law has provided a permanent solution to this problem. Now, a single tax year will be implemented. This simply means that any income you earn between April 1st and March 31st will be calculated and taxed within that year. This will simplify the tax calculation process significantly, eliminating the need for even first-time taxpayers to rely solely on a chartered accountant (CA).

Will Instagram posts detect tax evasion?
For some time now, there has been a heated debate about whether the tax department will now digitally spy into people's bedrooms and vacations. Will officials be able to monitor your WhatsApp chats and Instagram reels? The new law clarifies this situation. While the new Act empowers tax officials to collect digital evidence, its scope is limited.

This provision applies only to cases where there is suspicion of serious tax evasion. No official can search a citizen's social media accounts or private messages without a valid basis or a search warrant. The department must follow a prescribed legal process for this. This means that if you are an honest taxpayer, you have no need to fear your social media activity.

TDS money won't be lost even if you file a late return.
This change is good news for salaried individuals and middle-class families. Under the old rules, if you failed to file your Income Tax Return (ITR) by July 31st (or the due date), you would lose your right to a refund. Your hard-earned money would go to the government treasury.

The new Income Tax Act has changed this strict rule. Now, even if you file a belated return, you will still be able to claim your TDS refund. However, to maintain discipline, the government has introduced a late fee. Those with incomes below ₹5 lakh will have to pay a fine of ₹1,000, and those with incomes above ₹5,000. Even if you pay the fine, you'll be able to avoid losing a substantial refund.

A setback for investors in gold bonds
Until now, Sovereign Gold Bonds (SGBs) were considered the best tax-saving and safe investment option, but new regulations have somewhat diminished their luster. According to the new Act, if you purchase Sovereign Gold Bonds from the stock market (secondary market), you will now be taxed on the profits earned.

According to the rules, such profits will be taxed at a rate of 12.5%. Previously, this category was considered completely tax-free. This change is a setback for investors who traded gold bonds through the stock market. While the relief provisions are expected to continue for investors who hold the bonds till their full maturity, secondary market buyers will now have to loosen their purse strings.

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