MONEY
New Income Tax Act notified with a mix of taxpayers’ relief and tighter compliance
- IBJ Bureau
- Mar 21, 2026
The Central Board of Direct Taxes (CBDT) has notified the rules to operationalise the new simplified Income Tax Act, with a mix of taxpayers’ relief and tighter compliance with effect from April 1.
The rules have raised House Rent Allowance (HRA) limits to 50 per cent of salary in eight major cities – including Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Pune, Ahmedabad and Bengaluru –while mandating disclosure of landlord-tenant relationships.
They have expanded perquisite benefits, extending exemptions like food coupons and employer-provided cars to new tax regime. Besides, the rules explicitly include electric vehicles under the concessional valuation slab for employer-provided motor cars.
“The new rules should greatly help employers and employees, given the recalibrated and realigned limits for various employee perquisites and exemptions,” said Suresh Kumar S, a partner at Deloitte India.
The framework has tightened disclosure requirements for salaried taxpayers, foreign portfolio investors and cross-border entities, placing greater onus on auditors and companies. This signals a shift towards a more compliance-driven regime aligned with global standards.
In a key change, the rules have introduced “hard thresholds” for professionals undertaking complex certifications, such as fair market valuation and transfer pricing.
Chartered accountants must now have at least 10 years of experience, with minimum annual receipts of Rs 50 lakh for individuals and Rs 3 crore for firms.
Timelines for filing of correction statements for tax deducted and collected at source have been reduced to two years from six. This underscores the push for faster processing and near real-time compliance.
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