Income Tax Filing AY 2026-27: What Has Changed and What You Must Know

Overview of AY 2026-27 Changes

The Union Budget 2025 introduced sweeping reforms to the personal income tax structure under the New Tax Regime, making it even more attractive for salaried individuals. At the same time, there are important changes in TDS rates, rebate limits, and capital gains reporting that all taxpayers must be aware of.

New Tax Regime — Updated Slabs

Under the revised new tax regime (default from AY 2025-26 onwards), the tax slabs for AY 2026-27 are:

• Rs. 0 to 4,00,000 — Nil
• Rs. 4,00,001 to 8,00,000 — 5%
• Rs. 8,00,001 to 12,00,000 — 10%
• Rs. 12,00,001 to 16,00,000 — 15%
• Rs. 16,00,001 to 20,00,000 — 20%
• Above Rs. 20,00,000 — 30%

Section 87A Rebate — Revised

The tax rebate under Section 87A has been enhanced. Taxpayers with total income up to Rs. 12 lakh under the new regime will now pay zero income tax after the rebate is applied. This is a significant relief for middle-class taxpayers.

The 2025 Budget rebate expansion means millions more Indians are now effectively zero-tax payers — but only if they file correctly.

Capital Gains — Critical Changes

Short-term capital gains (STCG) tax on listed equity shares under Section 111A has been revised from 15% to 20%. Long-term capital gains (LTCG) exemption limit under Section 112A remains at Rs. 1.25 lakh per year.

Important Deadlines for AY 2026-27

• July 31, 2026 — Due date for non-audit cases (salaried, individuals)
• October 31, 2026 — Due date for audit cases
• November 30, 2026 — Due date for transfer pricing cases

What You Should Do Now

Start collecting your Form 16, capital gains statements, bank interest certificates, and Section 80C investment proofs. Early filing not only helps avoid last-minute errors but also speeds up your refund processing.