The Income Tax Act, 2025 replaces the six decades old Income Tax Act, 1961 With effect from April 1, 2026. The objective of this act is to enhance predictability, transparency, reduce compliance burden, and offer taxpayers a streamlined and simplified tax filing process. Compared to the old Act, which had 819 Sections and 14 Schedules, the 2025 Act is leaner, with 536 Sections and 16 Schedules. Further, the number of Rules have also been reduced from 511 to 333, while forms have been significantly reduced from 390 to 190.
Particularly, this rationalisation is evident in provisions that directly impact individual taxpayers. Until the Income Tax Act 2025 comes into effect, taxpayers had to carefully assess their eligibility and often faced confusion over choosing the correct form. Form 15G or Form 15H? Form 15G was used by resident individuals below 60 years and other eligible persons, while Form 15H was filed by resident individuals aged 60 years or above.
For those unfamiliar, the two forms are nothing but declarations stating that the taxpayer’s estimated total income for the financial year is nil, ensuring that TDS is not deducted unnecessarily. Eliminating ambiguity, under the new Income Tax Act, 2025, both forms have been merged into a single unified Form 121. Under Section 393(6) of the new Act, Form 121 applies to all declarants regardless of age.
