What is the news?
The Central Government has announced many important changes related to income tax in the Union Budget 2026. Their objective is to simplify the process of filing taxes and reduce the burden of rules on people. The government has decided to implement the new Income Tax Act 2025, which will come into effect from April 1, 2026. However, there has been no change in the tax slabs and the existing rates will continue.
ITR filing date extended
The government has extended the deadline for filing income tax returns for some taxpayers. Those whose accounts are not required to be audited and who file ITR-3 or ITR-4 will now be able to file returns till August 31. Earlier this time limit was less. Whereas the last date for filing ITR-1 and ITR-2 will remain 31st July. Apart from this, the deadline for filing revised returns has also been extended till March 31.
Changes in TCS and STT rules
The rules of Tax Collected at Source i.e. TCS have also been changed in the budget. TCS rates have been changed in some cases to simplify the tax system. At the same time, the Securities Transaction Tax (STT) imposed on futures and options trading related to the stock market has also been increased. The central government says that these changes will make the tax system more clean and organized.
Investments and Dividends
Changed rules related to investment and dividend
The government has also changed the tax rules for the amount received from share buyback. Now from April 1, 2026, such amount will be taxed as capital gain. Apart from this, the deduction on interest on loans taken to earn dividend income has also been abolished. That is, now tax will have to be paid on the entire income received from dividend as per the fixed tax rate.
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