Income Tax: What rules have changed so far? Learn about the impact on your income and savings
The year 2025 brings many important changes for taxpayers. It's crucial for taxpayers to understand the changes in income tax rules and how they will impact their income and savings. Let's understand the full picture of these changes.
The year 2025 has been significant for income tax payers in many ways . This year saw not only changes in tax rules, but also an effort to simplify the return filing process.
The objective of these changes was clear: simplify the tax system, reduce errors, and provide relief to honest taxpayers. These changes will also impact your tax planning in the coming years.
Big relief due to increase in tax free income limit
The most significant change in Budget 2025 concerns tax-free income. With the increased tax rebate under the new tax system, even high-earning salaried individuals will now be exempt from paying taxes.
After taking advantage of the standard deduction, income up to a certain limit is now completely tax-free. This directly benefits the middle class and working people.
Changes in the ITR filing process
In 2025, changes were made to the deadlines and procedures for filing income tax returns, with deadlines extended several times to give taxpayers more time to file their returns correctly. Additionally, online rectification was introduced for certain tax orders, reducing office visits and speeding up work.
TDS and TCS rules simplified
2025 brought relief to small taxpayers and senior citizens. The TDS threshold was raised on bank interest, rent, and certain payments.
This reduced the problem of repeated tax deductions and the hassle of refunds. This particularly benefited senior citizens and small business owners.
New TDS rules on payments to partners
Starting in 2025, a new TDS rule was implemented on salaries, bonuses, commissions, or interest received by partners in firms and LLPs .
This aims to increase tax transparency. While this has increased compliance, it will also make the tax system more transparent and reliable in the long run.
More time to file updated returns
Taxpayers will now have more time to correct their mistakes. The deadline for filing updated returns has been extended, allowing individuals to accurately declare income from previous years. This will reduce tax disputes and provide individuals with the opportunity to correct their mistakes without fear.
Income Tax