Income Tax Department India: New Rules, Slabs & Key Updates

The Central Board of Direct Taxes (CBDT) has notified new Income Tax Return (ITR) forms for the Assessment Year (AY) 2025–26, bringing significant changes to ITR-1 (SAHAJ) and ITR-4 (SUGAM) . These are among the most commonly used return forms by salaried individuals, pensioners, and small business owners or professionals under presumptive taxation. The updates aim to simplify return filing while enhancing the granularity of disclosures, enabling the Income Tax Department to improve compliance checks and reduce tax avoidance. Below is a comprehensive breakdown of the changes, their implications, and what taxpayers need to keep in mind I. Overview of ITR-1 (SAHAJ): What’s Changed? What is ITR-1? ITR-1 is applicable to resident individuals (not ordinarily resident) with a total income up to ₹50 lakh from the following sources: Salary or pension One house property Other sources (excluding winning from lottery, racehorses, etc.) Major Change: Inclusion of LTCG under Section 112A Historica...