Draft Income-tax Rules, 2026 and Forms related to the Income-tax Act, 2025

Aspects

Provisions

Simplified Structure

• Rules reduced from 511 to 333
• Forms reduced from 399 to 190
• Achieved by removing redundancies and merging provisions.

Simplified ITR Forms

• Common details standardised, clearer language, and reduced duplication to lower compliance burden.

Technology Integration

• Prefilled information and automated reconciliation.
• Centralised processing and data-based decision-making to improve taxpayer services.

Taxation Clarifications

• Rules for calculating the holding period of capital assets in specific situations.
• A framework for notifying Zero Coupon Bonds (ZCBs).
• Procedures for applications by infrastructure-related entities.

Public Consultation

• Draft rules and forms placed in the public domain for 15 days.
• Feedback period ends on 22 February 2026.
• To make subordinate legislation more inclusive and effective.

Consultation Tools

• Tool 1 – Comparison between old and draft rules.
• Tool 2 – Comparison between existing forms and new draft forms.

The Central Board of Direct Taxes (CBDT)

• The CBDT is a statutory authority functioning under the Central Board of Revenue Act, 1963.
• Composition – CBDT consists of a Chairman and six Members.
• The officials of the Board, in their ex officio capacity, also function as a Division of the Ministry dealing with matters relating to the levy and collection of direct taxes.