The Income Tax Department will notify the new ITR forms and rules by January, the first month of the new year. This update was shared by Ravi Agarwal, head of the Central Board of Direct Taxes (CBDT).
He said that the department is currently preparing the forms and rules under the simplified Income Tax Act, 2025, and aims to notify them by January.
This timeline will give taxpayers enough time to adjust their processes within the system.
Agarwal added that the main goal is to simplify the Income Tax Return (ITR) forms to make compliance easier for taxpayers.
The new Act will come into effect from the next financial year beginning April 1.
The new law will replace the Income Tax Act, 1961, which has been in place for nearly six decades.
The Income Tax Act, 2025 was passed by Parliament on August 12. All related forms, such as TDS quarterly return forms and ITR forms, are being redesigned.
The Directorate of Systems, along with the Tax Policy Division, is working to make these forms more user-friendly.
After the Law Department reviews the rules, they will be notified and presented before Parliament.
The Act will officially come into effect from the next financial year 2026–27 (April 1, 2026) and aims to make tax laws simpler and easier to understand.
Key Features of the New Income Tax Act
The new law does not introduce any new tax rates. Its main purpose is to simplify the language of the Income Tax Act, making it easier to understand complex tax provisions.
Some major changes include:
Removal of outdated and unnecessary provisions
Reduction in the number of sections from 819 to 536
Reduction in the number of chapters from 47 to 23
Decrease in total word count from 5.12 lakh to 2.6 lakh words
Addition of 39 new tables and 40 new formulas to replace long and complicated text
These changes are designed to improve clarity and make income tax rules easier for taxpayers to follow.
