The Income Tax Department has recently updated the capital gains taxation table and this is important information since the rate of capital gains tax both long term (LTCG) and short term (STCG) is different for different asset classes. Do note this tax rate is applicable for individuals under both new and old tax regime, as these are all special rate incomes.

“Determination of Tax in certain special cases: Since all the incomes are not taxable at the same rate. The document provides a list of Capital Gains/Incomes arising out of certain securities eligible for special tax rates. It contains details with respect to the eligible assessee, security, or tax rates etc.,” said the Income Tax Department.

Capital gains (LTCG & STCG) income tax rate on equities, others
Here’s the table released by the Income Tax Department:

Mihir Tanna, associate director, S.K Patodia LLP says: “Indian Income Tax provisions specified a certain type of income which is not taxable at slab rate but taxable at special rate like sale of equity shares/units of equity mutual funds through recognised stock exchange.

A fresh ITR 5 form has been notified by the Central Board of Direct Taxes (CBDT), effective April 1, replacing the earlier version used for firms, LLPs, Association of persons (AOPs), Body of Individuals (BOIs), and similar entities.

“In exercise of the powers conferred by section 139 read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:- 1. (1) These rules may be called the Income-tax (Fourteenth Amendment) Rules, 2025. (2) They shall come into force with effect from the 1st day of April, 2025. 2.

The Central Board of Direct Taxes (CBDT) notified the Income Tax Return form-2, or ITR-2, for FY2024-2025 on May 5, 2025. ITR 2 is relevant for the majority of taxpayers, especially salaried employees and pensioners. The form will be effective retrospectively from April 1, 2025, i.e., since the beginning of the current financial year.

Notably, individuals who have salary or pension income or earn income from more than one house property are eligible to file their income tax return using ITR-2. Importantly, any income from capital gains or losses on the sale of property or other investments, either long-term or short-term, is to be reported in this ITR.

The income-tax department has set an ambitious target to dispose of over 200,000 cases, involving an aggregate disputed amount of Rs 10 lakh crore, lying with the first forum of appeal, in the current financial year.

This compares with over 1,72,000 cases resolved at the Commissioner of Income Tax (Appeals) stage in FY25, where the locked amount was about Rs 6.3 lakh crore.

Going by the trend in recent years, the revenue department manages to lay its hands on roughly a third of the disputed amount, immediately after such mutual resolutions.

If the targetted number of cases are resolved by the CIT (Appeals) in FY26, it would result in not only a big jump in tax receipts, but could also improve the liquidity position of hundreds of businesses, enabling them not only to meet operational costs, but even scale up capital expenditure.

The CBDT has directed income-tax officials to "closely" monitor top advance tax payers and identify bogus claims of exemptions and deductions as part of the strategy to improve direct tax collections during the current financial year.

Official sources told PTI that the Central Board of Direct Taxes, the policy-making body for the department, had recently issued the central action plan (CAP) for 2025-26 that acts as the guiding light to steer 'key performance areas' for the department vis-a-vis revenue collection work.

The Union government has set a target of Rs 25.20 trillion for the I-T department under the direct taxes head for the current fiscal, as per the Budget estimates presented in February.

The Central Board of Direct Taxes (CBDT) has notified Income Tax Return Form 3 (ITR-3) for Assessment Year 2025-26, applicable for income earned in the financial year 2024-25. Form ITR-3 applies to individuals and Hindu Undivided Family (HUF) earning income from profits and gains of business or professionals like doctors, lawyers, consultants or freelancers.

On April 29, the income tax department had notified ITR-1 and ITR-4 forms for AY 2025-26, and made it easier for individuals with long-term capital gains (LTCG) of up to Rs 1.25 lakh from listed equities to file returns.

The income-tax department has made significant changes in ITR3. The threshold for reporting assets and liabilities (under Schedule AL) has been raised from Rs 50 lakh to Rs 1 crore, reducing the disclosure burden on middle-income taxpayers.

If you're a partnership firm, LLP, or Association of Persons filing taxes this year, there’s a new Income Tax Return form you need to get familiar with. The Central Board of Direct Taxes (CBDT) has notified the new ITR-5 form for Assessment Year 2025–26 via Notification No. 42/2025, effective from April 1, 2025—and it comes packed with changes that could impact your reporting, deductions, and refund timelines.

1. Capital Gains Now Split by Key Date
One of the biggest updates lies in Schedule CG, where capital gains are now reported in two segments:

Before July 23, 2024: For transactions before key Finance Act changes took effect.

On or After July 23, 2024: For post-amendment gains or losses.
This bifurcation helps align gains with applicable tax treatments and gives tax officers clearer audit trails.

ITR-3 For Income Tax Return Filing 2025: The Central Board of Direct Taxes (CBDT) has notified Income Tax Return Form 3 (ITR-3) for Assessment Year 2025-26, applicable for income earned in the financial year 2024-25. While the form has been officially released, the utility for filing it electronically is still awaited.

It comes after the income tax department on April 29 notified ITR-1 and ITR-4 forms for AY 2025-26, and made it easier for individuals with long-term capital gains (LTCG) of up to Rs 1.25 lakh from listed equities to file returns.

The Income-Tax (I-T) Department has invoked the benami law to fish out information from a few payment gateway (PG) companies.

At least two firms have been told to disclose the identities of persons linked to a string of United Payment Interface (UPI) IDs, the entities who received money, and details like transaction date, amounts, and bank account numbers.

Gateways offer a network for customers to send money to businesses and merchants. Shell companies posing as merchants sometimes register themselves with PGs to move money.

The tax office, probably based on feedback it has received, would verify whether some merchants are holding money on behalf of others; or, if sham merchants are helping fund remitters book bogus expenses to evade tax. Here, the receiver later returns the funds in cash to the sender.

The Central Board of Direct Taxes (CBDT) has notified the income tax return forms 1 and 4. The notification of the ITR forms have come after a long wait. The notified ITR forms are applicable for the financial year 2024-25 and the assessment year 2025-26. This means that incomes earned between April 1, 2024, and March 31, 2025, must be reported to the government using the forms now notified.

It is important to note that not all taxpayers can file their income tax returns using the notified forms. Depending upon the source and nature of income, the income tax department comes up with different forms. There are eligibility conditions associated with each form that a taxpayer must satisfy to be eligible to file their income tax returns using the currently notified ITR forms.

The CBDT instructed every jurisdiction within the I-T Dept to carry out at least 1 major search and seizure operation by July 31, and 2 more between August and March 2026, the report said.

In a major move to combat black money and tax evasion, the Central Board of Direct Taxes (CBDT) has reportedly instructed the Income Tax Department's field formations to implement an aggressive, time-bound strategy aimed at expanding the tax net.

According to a media report, the CBDT anticipates uncovering undisclosed income worth an estimated Rs 2.4 lakh crore during the current financial year, stated IANS.

Under the new directive, every jurisdiction within the Income Tax Department must carry out at least one major search and seizure operation by July 31. Additionally, between August and March 2026, each jurisdiction is expected to conduct two more significant operations, reported NDTV Profit.

The income tax department on Thursday said taxpayers will not be allowed to claim deduction for expenditures incurred to settle proceedings initiated under four laws, including the Sebi and the Competition Act.

In a notification issued on April 23, the Central Board of Direct Taxes (CBDT) notified that any expenditure incurred to settle proceedings initiated in relation to contravention or defaults under the four specified laws shall not be deemed to have been incurred for the purpose of business or profession and no deduction or allowance shall be made in respect of such expenditure.

The four laws are the Securities and Exchange Board of India Act, 1992; the Securities Contracts (Regulation) Act, 1956; the Depositories Act, 1996; And the Competition Act, 2002.

The Central government has introduced changes to the Income Tax Act, 1961, expanding the scope of the Tax Collected at Source (TCS) on luxury goods. Starting April 22, 2025, TCS will be applicable to 'specified range' of luxury goods valued over ten lakh rupees, including items like wristwatches, art pieces, yachts, and more.

Below are comprehensive FAQs on the new provisions, along with the list of luxury goods that will be subject to TCS:
What changes were brought in section 206C(1F) of the Income Tax Act, 1961 through Finance (No. 2) Act, 2024?
Earlier, Section 206C(1F) provided for collection of TCS on the sale of motor vehicles of value exceeding Rs 10 lakh.
Through the Finance (No. 2) Act, 2024, Section 206C(1F) was amended to include a wider range of luxury goods.

India is spawning a new rich class, especially in its small towns, which splurges on personal luxury goods with abandon but often escapes the income tax net. But not anymore. The July 2024 Budget had proposed to bring the expenses made on luxury goods by the rich under the ambit of TCS (Tax collected at source) if cost of luxury goods is more than Rs 10 lakh. This tax is now taking effect from April 22, 2025. From wrist watches to art pieces to yachts to handbags, purses and shoes to golf kits, a number of luxury goods will now attract TCS.

However, with this new TCS, the government is not intending to bulk up its direct tax revenues. Once the TCS is collected from the buyer, it is the seller's duty to deposit the same against the buyer’s PAN.

Many salaried individuals claim tax exemption on house rent allowance (HRA) by paying rent to family members, such as parents. While this is legally permissible, the Income Tax Department has intensified scrutiny of such claims.

Increased scrutiny

Tax authorities say they have observed instances where individuals claimed HRA exemption without fulfilling rules to do so.

Common issues include:

Lack of a formal rental agreement.

Rent payments made in cash, or lacking bank transaction proof.

Absence of rent receipts.

Landlords not declaring rental income in their tax returns.

Such discrepancies raise flags, prompting the department to issue notices seeking clarification to many individuals recently.

The income-tax (I-T) department has issued showcause notices under Section 68 of the Income-Tax Act to several startups over funds routed through Singapore, seeking explanations for investments received over the past five years, people familiar with the development said.

The department is questioning the source, identity, and creditworthiness of overseas investors in these transactions, they said.

In addition, the notices are also being served on Non-Resident Indians (NRIs) holding bank accounts in Singapore.

“These are not routine inquiries, but formal show-cause notices.

The income tax department on Tuesday said it has introduced the 'e-Pay Tax' feature on its official online portal to make it simple for taxpayers to pay taxes. "The 'e-Pay Tax' feature introduced by the Department is an elegant, efficient, and hassle-free method to fulfil your tax obligations," the tax department said in a statement.

Gone are the days of long queues at banks, tedious form-filling, and the looming anxiety of last-minute tax payments. Recognising the need for simpler and more accessible payment methods, and in another step towards digitally empowering the taxpayers, the Income Tax Department has introduced the 'e-Pay Tax' feature on its official online portal, it added.

The Central Board of Direct Taxes (CBDT) has issued a notification specifying the list of luxury goods on which tax collected at source (TCS) will be levied. The CBDT has issued two notifications in this regard. The first notification deals with the nature of luxury goods, while the second one deals with the tax rate and threshold purchase amount above which tax will be levied.

It was a long-awaited notification, as the TCS on luxury goods was announced in the July 2024 Budget. The Budget 2024 memorandum stated that the TCS on luxury goods will be applicable from January 1, 2025. However, there was no notification in this regard to date.

The notifications issued on April 22, 2025, state that the new rules take effect from the date of publication.

It seems that due to deletion of two words – ‘no deduction’ in the proposed new Income Tax Bill 2025 will result in removal of the concept of ‘nil TDS’ certificate for both Indian taxpayers and non-residents including NRIs. To understand how big of an impact this removal is, you need to understand when does a taxpayer need a nil TDS certificate? A nil TDS certificate needs to be applied online by a taxpayer when he/she expects to get an income on which no income tax is required to be paid due to any reason.

So, it's like if your actual income tax liability from any income is 0 but Rs 1 lakh TDS is being deducted on this income, then in this situation you can apply for this nil TDS certificate and if it's granted then zero TDS will be deducted. Similarly in case of tax liability being less than the TDS amount you can apply for lower TDS deduction request.

The Central Board of Direct Taxes (CBDT) has clarified that startups recognised by the Department for Promotion of Industry and Internal Trade (DPIIT) and compliant with required declarations will not face scrutiny under Section 68 of the Income-tax Act, 1961, for foreign investments. Investments in such entities are exempt from tax-related questioning under this provision, which deals with unexplained credits, the Board said.

"Recognised startups that fulfil the conditions laid down in Notification No. G.S.R. 127(E) of DPIIT dated February 19, 2019, and file declaration in Form-2, are eligible for various tax exemptions and deductions under the Income-tax Act, 1961. Investments made in such companies are eligible for benefits and are not subject to scrutiny," CBDT said on X in response to tax lawyer Ajay Rotti’s post on X.