The Government of India has recently introduced Income Tax Bill 2025, which aims to make the Income Tax Act, 1961 simple and transparent. Many significant changes have been made in this new bill, which can be beneficial not only for individuals but also for businesses. In this article, we will discuss in detail about these new rules and also tell which people will no longer have to pay tax.
Under this new bill, there has been no change in the tax slab, but the tax rebate has been increased. In addition, standard deduction has also been increased, which will give additional benefits to salary individuals. Let us understand these changes in detail.
Income Tax New Rules 2025: Major Highlights
The table below gives details of the main points of Income Tax Bill 2025:
| Speciality | Description |
| Tax slab | No tax up to Rs 12 lakh till income (in new tax regime). |
| Standard deduction | Standard deduction of Rs 75,000 for salary persons. |
| Tax rebate | Tax rebate up to Rs 60,000, so that there is no tax on income up to Rs 12 lakh. |
| Positive taxation | Simplified Present Taxation Scheme for small businesses and professionals. |
| TDS and TCS | TDS and TCS rates fixed at various income sources. |
| Tax return filing | There is no change in the time limit for tax return filing. |
Tax slabs and rebate changes
There has been no change in the slab of income in the new tax regime, but the tax rebate has been increased. Now a rebate of up to Rs 60,000 will be available, so no tax will have to be paid on income up to Rs 12 lakh. For salary individuals, this limit is up to Rs 12.75 lakh, as they get standard deduction of Rs 75,000.
Present taxation scheme
The Present Taxation Scheme has been simplified, which will benefit small businesses and professionals. Under this scheme, businesses will have to pay only a certain percentage of their income as tax, such as 6% or 8%, whichever. This rate is 50% for professionals.
TDS and TCS Provisions
Changes have also been made in the rules of TDS (Tax Deed at Source) and TCS (Tax Collectorate at Source). TDS rates have been determined at various income sources, such as salary, professional fees, interest income, and rent. TCS applies to specific transactions, such as sales of motor vehicles and foreign remedies.
Tax -free income
Now, under the new tax regime, no tax will be paid up to Rs 12 lakh till income, provided that a tax rebate of Rs 60,000 is received. For salary individuals, this limit is up to Rs 12.75 lakh, as they get standard deduction of Rs 75,000. This is very beneficial for those who come from low and middle income groups.
Who will be free from tax?
- Low income group: People whose income is less than Rs 12 lakh, will not have to pay any tax.
- Salared person: Income for salary persons will be tax free up to Rs 12.75 lakh, as they get standard deduction of Rs 75,000.
- Small Business: Businesses who take advantage of the Present Taxation Scheme, they will have to pay only a certain percentage of income.
Impact of new tax rules
The effect of these new rules will vary on different classes:
- Personal Taxpayer: People of low and middle income groups will get more benefits, because their income will be tax free up to Rs 12 lakh.
- Business: The Present Taxation Scheme has become simplified for small businesses, which will make them less administrative burden.
- Government: The government hopes that this will improve tax compliance and the tax system will be more transparent.
conclusion
Changes made under Income Tax Bill 2025 will benefit not only individuals but also businesses. People of low and middle income group will be specially benefited by tax -free income in the new tax regime. Also, the Present Taxation Scheme has become simplified for small businesses, which will make them less administrative burden.
Important vocabulary
- Tax Slab: Tax rates incurred at various levels of income.
- Tax Rebet: The amount given under the Income Tax Act, which reduces the tax liability.
- Standard deduction: A cut of a certain amount given to salary individuals, which reduces their tax liability.
- Pressation: A scheme in which businesses have to pay only a certain percentage of their income as tax.
Disclaimer: This article is for general information and should not be taken as any specific financial advice. It would be appropriate to consult a professional advisor for a personal tax status.
