Kamal Ghorui
The Income Tax Department is likely to notify the draft Income Tax Rules, 2026 and the accompanying forms in the first week of March, Central Board of Direct Taxes (CBDT) sources told ET.The new rules are aligned with the Income Tax Act, 2025, which is scheduled to come into force from April 1, 2026, and will replace the existing Income Tax Rules, 1962. Once notified and approved by Parliament, the Income Tax Rules, 2026 will be applicable from the same date.
The department had earlier released draft rules and forms as part of the transition to the new Income Tax Act, aimed at simplifying compliance and aligning procedural provisions with the updated law.Sources said revisions related to perquisites under the new framework will be applicable under both the old and the new tax regimes, offering relief across categories of taxpayers.The notification of the rules is seen as a key step in operationalising the Income Tax Act, 2025, ahead of its scheduled rollout from the next financial year starting April 1, 2026.The draft rules and forms will remain in the public domain for 15 days, until February 22, 2026. The Income Tax Department had invited stakeholders and members of the public to examine the draft framework and submit feedback, saying the consultative process is aimed at making the framing of subordinate legislation more participative and effective.According to the department, the drafting of the new Income-tax Rules and forms follows the same philosophy as the Income Tax Act, 2025, with a focus on simplification and clarity. The language of the rules has been simplified wherever possible, with formulas and tables introduced to improve understanding, while efforts have been made to eliminate redundancies present in the existing Income-tax Rules, 1961.While the broader policy framework has been retained, the department said selective changes have been introduced to align the rules and forms with provisions of the Income Tax Act, 2025.The tax forms included in the draft rules have also been significantly simplified to ease compliance for taxpayers. Common information has been standardised across forms to reduce duplication and lower the compliance burden.The department said the redesigned forms incorporate features such as automated reconciliation and pre-fill capabilities, making tax filing more intuitive and less prone to errors. It added that the use of smart forms would facilitate centralised processing and data-driven decision-making, enabling improved taxpayer services.Officials said the language used in the forms and accompanying notes has been simplified to avoid operational, administrative and legal ambiguity, further enhancing the overall taxpayer experience.
