The year 2025 was different for taxpayers in many ways. Income tax rules were changed, and new developments were introduced regarding tax slabs and rebates. Let’s learn about these major changes…
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Year Ender 2025: The year 2025 was different for taxpayers in many ways. Income tax rules were changed, and new developments were introduced regarding tax slabs and rebates. This directly impacted the common man’s pockets. Meanwhile, technical issues while filing ITRs forced many people to wait for refunds, further compounding their problems.
The year 2025 is coming to an end. Before entering the new year, it’s important to understand these changes so that we can better prepare for our tax planning in the future. Let’s learn about these key changes…
1. Central Government Changes Tax Slabs
The Central Government took a historic decision to change the tax slabs to provide relief to the middle class. The tax-free income limit was increased in the Union Budget 2025.
According to the new tax slabs, the rebate limit has been raised to Rs 12 lakh. This means that salaried individuals will not have to pay tax on income up to Rs 12.75 lakh after standard deductions.
2. Changes in the ITR Form
The structural changes and system updates made to the ITR form resulted in delays in refunds for many taxpayers. Income tax cases related to capital gains from mutual funds, shares, and property faced significant difficulties, causing inconvenience to taxpayers.
3. Major Changes in the Income Tax Act
The biggest changes in 2025 include the new Income Tax Act. This law will replace the nearly 60-year-old Income Tax Act, 1961, and will be implemented from April 1, 2026. The new law focuses on simplifying the tax system to make it easier for ordinary taxpayers to understand the rules.
4. Capital Gains Tax Rules Changed
The government announced major changes to capital gains tax in 2025. The tax on short-term capital gains on equity was increased from 15 percent to 20 percent. The tax-free long-term capital gains limit was increased to ₹1.25 lakh.
5. GST Reform Decision
The central government launched GST 2.0, which involves major changes to the indirect tax system. The announcement of reducing GST on several essential commodities has garnered significant attention.
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