The Central Board of Direct Taxes (CBDT) has exempted payments made by finance companies, fund management entities, recognised clearing corporations and stock exchanges to International Financial Services Centre units from deducting tax at source (TDS), effective July 1.

CBDT said Saturday the exemption will cover payments under several categories, including those made by stock exchanges, commission incentives, interest from leases, freight or hire charges from finance firms, portfolio management fees, advisory charges and other service fees, professional and technical fee and rent for data centres. The payee must furnish a statement-cum-declaration to the payer. The relief is available for 10 consecutive assessment years chosen by the payee.

The income tax department has extended the due date to file an income tax return for FY 2024-25 (AY 2025-26) from July 31, 2025, to September 15, 2025. The last date to file the ITR has been extended beyond July 31 for taxpayers whose accounts are not required to be audited, such as salaried taxpayers, NRIs, and pensioners.

Typically, July 31 is also the due date for taxpayers to deposit their self-assessment tax. It is the amount of tax that a taxpayer is liable to pay after deducting the TDS, TCS and advance tax payments. If a belated ITR is filed (i.e., the income tax return is filed after the due date) and the self-assessment tax is also paid after the due date, then the taxpayer has to pay penal interest under Section 234A on the self-assessment tax due.

The deadline to file ITR has been extended, but does this mean taxpayers can deposit their self-assessment tax without penalty till September 15, 2025, i.e., has the due date for payment of self-assessment tax for FY 2024-2025 (AY 2025-26) also been extended?

The income tax department is taking action against non-compliant people having foreign income, the finance ministry on Friday said, adding that as many as 5,483 taxpayers have filed belated returns reporting foreign assets worth Rs 29,208 crore.

The finance ministry’s statement comes amid reports that money deposited in bank accounts of Indian entities in Switzerland has increased in 2024.

Indian money parked in Swiss banks more than tripled in 2024 to 3.5 billion Swiss francs on the back of a huge jump in funds held through local branches and other financial institutions, annual data released by Switzerland’s central bank showed on Thursday.

“In cases of continued non-compliance, enforcement and statutory actions are being taken as per extant law,” the ministry said. A total of 24,678 taxpayers reviewed their ITRs and 5,483 taxpayers filed their belated return for the assessment year (AY) 2024-25, reporting foreign assets of Rs 29,208 crore and additional foreign income of Rs 1,089.88 crore, the ministry said.

The Income Tax department has sent bulk emails to numerous taxpayers who either haven’t paid the correct income tax on their cryptocurrency dealings or have failed to report their cryptocurrency transactions in Schedule VDA (virtual digital assets) of the Income Tax Return (ITR). [1] [2]

Keep in mind that if you are using foreign crypto exchanges like Binance or others, then you need to file Schedule FA in addition to the VDA schedule in the ITR. Overlooking any of these requirements, could get you into trouble with the tax authorities.

It's true that in the past similar bulk emails and notifications were sent out regarding unreported incomes, but this time things are different. The income tax department now has access to information and data about undisclosed crypto income even if the crypto transactions did not go through any Indian exchanges. Multiple experts told ET Wealth Online that their clients received this notice and in some instances, the tax department even conducted search and seizure operations and confiscated hardware-based crypto wallets.

India's gross direct tax collection for the financial year 2025-26 rose by 4.86% to Rs 5.45 lakh crore as of June 19, according to the latest figures released by the government. However, net collections saw a marginal decline due to a sharp spike in refunds.

The total gross collections which include corporate tax, non-corporate tax, securities transaction tax (STT), and other levies stood at Rs 5,45,207 crore, up from Rs 5,19,936 crore during the same period last year.

There was the 58.04% jump in tax refunds, which soared to Rs 86,385 crore from Rs 54,661 crore a year ago. This surge in refunds likely reflects improved taxpayer services and faster processing.

As a result, net direct tax collection saw a marginal decline of 1.39%, falling to Rs 4,58,822 crore from Rs 4,65,275 crore in the previous year.

Overall advance tax receipts grew by 3.87% to Rs 1,55,533 crore. Corporate advance tax grew by 5.86% to Rs 1,21,604 crore, but non-corporate advance tax slipped 2.68% to Rs 33,928 crore.

The Central Board of Direct Taxes plans to make Aadhaar authentication compulsory for a new Permanent Account Number (PAN) card from July 1, officials said.

"The move for Aadhaar-based verification aligns with the digitalisation drive and efforts to ensure accountability and compliance in tax filing," said a senior official, who did not wish to be identified.

Currently, an application for a PAN can be made using name, proof of date of birth or any other identification, although existing PAN owners have been asked to link it with Aadhaar. For existing PAN card holders, the last date to link Aadhaar with PAN is December 31, 2025, without penalty. PAN not linked with Aadhaar will become inoperative from next year.

The income-tax portal will activate the new requirement for applications from July.

TheI-T authorities had made Aadhaar linkage mandatory after detecting issuance of multiple PANs to a single individual or use of PANs registered in names of others to evade tax.

The Centre’s advance tax collections have grown at a tepid pace till June 15 this fiscal, suggesting muted income growth amid global headwinds.

The total collection was Rs 1.54 lakh crore, up 4% from a year earlier, slowing sharply from the corresponding 27% growth last year, dragged down by lower personal income tax payments.

The amount collected was as of 11 pm on June 15. To be sure, with the last two days for making payments falling on a weekend, collection may improve further when these are reconciled later this week, officials added. Advance tax is paid in four instalments in a fiscal year—June 15, September 15, December 15 and March 15.

“A low growth amid high refunds in Q1 may be suggestive of a moderate pace of growth and expected profits, given the continuing global uncertainties related to tariffs and geopolitics,” said Aditi Nayar, chief economist, ICRA.

For tax assessees, AY 2025-26 is likely to be one of the years with the most significant changes in the way income tax returns (ITRs) are filed. Since the last ITR filing season, the Income Tax Department has introduced several changes, including updates to ITR forms, tax slabs, and other regulations.

The Income Tax Department has now issued new guidelines related to mandatory scrutiny of Income Tax Returns for the financial year 2025-26 (assessment year 2026-27). These guidelines were issued by the Central Board of Direct Taxes (CBDT) on June 14, 2025.

The ITR filing process is in full swing, with nearly 25 lakh income tax returns already filed and about 23 lakh verified. The most important development is that the Income Tax Department has started processing returns, as reflected on the tax portal, which shows that some ITRs have already been processed for the current assessment year. This means taxpayers with refunds due will start receiving them soon.

This year, the return filing started relatively late. The main reasons for this were the late release of ITR forms, technical changes in the e-filing utility, and time taken to update tax deduction (TDS) data.

“The jurisdiction of the Directorate of Public Grievances is hereby extended to Department of Revenue (Income Tax) and Central Board of Indirect Taxes and Customs (Customs related issues),” a notification issued by the Cabinet Secretariat said.

DPG helps to obtain responses to unresolved grievances on matters relating to some Central Government Departments and Organisations. It can help to obtain a response and resolution on these grievances from the department or organisation.

The Income Tax Department has sent a communication to thousands of individuals who have undertaken cryptocurrency transactions but failed to reflect this income in their returns, official sources said Friday.

These transactions pertain to assessment years 2023-24 and 2024-25, they said.

The department and its policy-making body, the Central Board of Direct Taxes (CBDT), suspect tax evasion and money laundering by certain "high-risk" people who are potentially using "unaccounted" income to invest in virtual digital assets (VDAs), commonly known as cryptocurrency.

Sources told PTI that the I-T Department has sent e-mails to thousands of defaulting people nudging them to file an updated Income Tax Return (ITR) if any income on account of crypto transactions has not been declared or mis-declared by them.

This communication is part of the NUDGE (Non-intrusive Usage of Data to Guide and Enable) campaign undertaken by the department with a philosophy of "trust taxpayers first" philosophy.

The Central Board of Direct Taxes (CBDT) is investigating instances of tax evasion and laundering of unaccounted income through cryptocurrency investments by high-risk individuals, income tax department sources stated.

Entities and individuals engaged in Virtual Digital Asset (VDA) transactions, who have failed to comply with the provisions of the Income-tax Act, 1961, have been identified for verification, the sources said. It is understood that the CBDT has recently issued emails to thousands of such defaulting taxpayers, urging them to review their income tax returns (ITRs) if any income from VDA transactions has not been properly disclosed.

Section 115BBH of the Income-tax Act, 1961—introduced through the Finance Act, 2022—imposes a flat 30% tax (plus applicable surcharge and cess) on income arising from the transfer of VDAs. The provision does not permit any deduction of expenses, other than the cost of acquisition. Further, the set-off of loss from VDA investment or trading is not allowed to be set off against any other income or for carry forward to subsequent years.

An non-resident Indian (NRI) residing in the United States of America had to go through a very challenging time when he sold a property in Pune for Rs 2 crore and followed the laid down procedure. The problem started when the buyer deducted 20% TDS on this property transaction and deposited it with the income tax department using a wrong TDS form. As a result of this, the TDS amount simply failed to show up in the NRI’s AIS. Without the TDS amount showing up in the AIS, the NRI could not claim it while filing Income Tax Return (ITR), resulting in a financial loss of Rs 18.68 lakh (20% TDS).

Moreover, the income tax department, unaware about this problem, issued a tax demand notice of Rs 46 lakh to this NRI as they deemed he sold the property and did not pay capital gains tax on it. The property buyer, however, claimed that he deposited the 20% TDS money with the income tax department and also showed a bank challan receipt for the same.

To give you a background context of this problem the property buyer deposited the 20% TDS in Form 26QB which relates to Indian residents. Since the property seller was NRI, the property buyer should have used Form 27Q to deposit the deducted 20% TDS.

Parliament’s select committee examining the Income Tax Bill, 2025, may not recommend any significant changes to the new provisions but only suggest "simplification of language" in some clauses to remove ambiguity, a source privy to the matter told Moneycontrol.

"The select committee has almost finalised its report (on the new bill)… There are no major recommendations," the person said. The committee, led by BJP MP Baijayant Panda, would submit its report to the government on the first day of the monsoon session, likely to begin in July’s third week.

The Income Tax Bill, 2025, was tabled by Finance Minister Nirmala Sitharaman in Parliament on February 13, as announced in the budget. The legislation seeks to repeal the Income Tax Act of 1961 and replace it with a simplified version. If passed, the new law will come into effect from April 1, 2026. Sources say the government is aiming to pass the bill in the upcoming winter session.

The Central Board of Direct Taxes, in the FAQs issued in February, had said that in the new bill, redundant provisions under the existing act have been removed; sub-sections and clauses have been used, instead of relying on provisos and explanations for exceptions and carve-outs; and a simplified system for cross-referencing of sections, sub-sections, clauses, etc., has been used.

Good news for those taxpayers who have any pending income tax refund due even after filing their income tax returns (ITR) on or before the deadline in 2024. The Income Tax Department has said such unprocessed ITRs for AY 2023-24 (FY 2022-23) will now be processed by them by November 30, 2025.

This announcement of AY 2023-24 pending ITR processing deadline extension by the tax department can mean either of these three things:

Tax refund: Once the said ITRs are processed, eligible taxpayers can get their due tax refunds with interest if any.
Tax demand notice: Some taxpayers may get a tax demand notice depending on what information the tax department finds out after processing the said ITR.
No refund no tax demand: The ITR is simply processed as it is i.e. without any tax refund or tax demand.

Every salaried employee who has an HRA component in salary and who wants to claim house rent allowance (HRA) income tax benefits need to submit the PAN number of the landlord if the annual rent is above Rs 1 lakh. Failing to submit the landlord's PAN to your employer for claiming rent HRA tax exemption, will result in losing the tax exemption.

Also submitting a false PAN number of landlords will result in you getting a tax notice and also losing the HRA tax exemption altogether. Earlier, the online ITR form or its utility did not have field to give details regarding the HRA. However, it has changed now, the income tax department has revised the utility, and it now requires taxpayers to give more details of the HRA claim by salaried employees. So does this mean that you have to give the landlord’s PAN card details while filing ITR?

Read below to know more about the importance of landlord’s PAN for your rent HRA tax exemption claim and what are the new compliance requirements for rent HRA tax exemption introduced in ITR filing of this year.

The Delhi High Court will soon to decide whether the tax department can retrospectively reopen old tax notices involving foreign assets—even if those notices were time-barred under earlier rules.

A division bench led by Justices Vibhu Bakhru and Tejas Karia was hearing a batch of petitions on 30 May – filed by companies such as UK Paints (Overseas) Ltd, BJN Holdings (India) Ltd, and KS Dhingra – challenging these reassessment notices under Section 148 of the Income Tax Act. It referred the matter to a larger bench for a final decision. The notices were issued between 2014 and 2021, covering assessment years that stretch back decades.

2012 amendment extended reassessment period
At the centre of the case is a 2012 amendment to the Income Tax Act that extended the reassessment period from six years to 16 years for cases involving foreign assets. After the amendment, which was aimed at tackling black money and undisclosed foreign assets, the department started issuing reassessment notices for older cases, some dating back to 1997.

The Central Board of Direct Taxes (CBDT) will undertake a detailed review of charitable entities and non-profit organisations to see if they are not being misused for terror financing or money laundering.

The review will be done in collaboration with agencies such as the Intelligence Bureau (IB), the Enforcement Directorate (ED) and the National Investigation Agency (NIA).

The CBDT will prepare a database of charitable institutions with foreign links, those receiving heavy foreign funds, or institutions that are registered but not filing returns or don't have much of a digital footprint, people aware of the details told ET.

The move comes after the department received information about the questionable role of some charitable institutions. Some of them received large amounts from across the border.

The board has asked officials to send notices by the end of June in cases that have been selected based on risk assessment or where it has received information from the IB, ED or NIA of links with any money laundering or terror financing cases, they said.

ITR Filing FY 2024-25: The Income Tax Department has activated its website incometax.gov.in for filing income tax returns using ITR-1 and ITR-4 forms. Eligible individuals can now submit their ITR via the e-filing portal for FY 2024-25 (AY 2025-26). Currently, only ITR-1 and ITR-4 submissions are available online, whilst those needing to submit ITR-2 or ITR-3 must wait for further updates.

Last month, the Income Tax Department had extended the deadline to file ITR for FY 2024-25 to September 15 from July 31.
Who can e-file ITR using ITR-1 for FY 2024-25?
The ITR-1 filing is allowed for Indian resident individuals who:
* Have a total annual income below Rs 50 lakh
* Earn from salary, one house property, family pension income, agricultural income (up to Rs 5000), and additional sources including:
* Savings Account interest
* Deposit interest (Bank / Post Office / Cooperative Society)
* Income Tax Refund interest
* Enhanced Compensation interest
* Other interest earnings
* Family Pension

The Income Tax Department has launched Excel-based offline utilities for ITR-1 and ITR-4 for the Assessment Year 2025-26, following a delay of nearly two months. These tools are designed to assist individual taxpayers with annual incomes under Rs 50 lakh, allowing them to prepare their income tax returns offline by entering income details, validating the data, and generating a JSON file for submission.

However, as noted by CA (Dr.) Suresh Surana, the e-filing portal required for online submission of these returns, is still not operational, hindering taxpayers who prefer or need an online interface for filing their returns. This delay has caused significant inconvenience to many taxpayers who rely on the online system for its ease of use and accessibility.