The Income Tax Department will notify the ITR forms and rules by January, the first month of the new year. This information has been given by Ravi Agarwal, head of the Central Board of Direct Taxes (CBDT).
He said on Monday that the Income Tax Department will notify the forms and rules under the simplified Income Tax Act, 2025 by January. Agarwal said, “We are in the process of preparing the forms and rules. We are working towards implementing them by January so that taxpayers get enough time to adapt their processes within our system.”
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He said the aim is to simplify the Income Tax Return (ITR) forms for taxpayers to ease compliance. The Act will come into effect from the next financial year beginning April 1. He said the department aims to simplify the Income Tax Return forms to ease compliance under the new law. The new law will replace the six-decade-old Income Tax Act, 1961.
The Act was passed on August 12.
The Income Tax Act, 2025 was passed by Parliament on August 12. All the various forms applicable under the Income Tax Act, such as the TDS quarterly return form and the ITR form, are being reworked. The Directorate of Systems, in collaboration with the Tax Policy Division, is working to make the forms taxpayer-friendly. The official said that after scrutiny by the Law Department, the rules will be notified and placed before Parliament. The Income Tax Act, 2025 will come into effect from the next financial year 2026-27 (April 1, 2026). The new Act will simplify tax laws and reduce jargon, making it easier to understand.
No new tax rate applicable
The new law does not introduce any new tax rates and only simplifies the language, which is essential for understanding complex income tax laws. The new law removes redundant provisions and outdated language and reduces the number of sections from 819 to 536 and the number of chapters from 47 to 23 in the Income Tax Act, 1961. The new law reduces the word count from 5.12 lakh to 2.6 lakh, and includes 39 new tables and 40 new formulas to replace the condensed text of the 1961 Act to enhance clarity.
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