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2h ago

CBDT Details Rollout of Overhauled Income-Tax Law, Promises Clear Digital Search Protocols

Officials say the law’s explicit digital powers reflect existing authority as rules and forms are readied by year-end for an April 2026 start.

New Income Tax 2025
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The Income Tax Act 2025 is a major attempt to bring India’s tax law into the digital era. (Photo: GettyImages)

Overview

  • The Income-tax Act, 2025 has been passed, received presidential assent, and will replace the 1961 law from April 1, 2026, with plainer language and a leaner structure that cuts sections and adds tables and formulae.
  • CBDT says draft rules, redesigned forms, SOPs, guidance notes and supplementary FAQs are in the works, with a target to finalize and notify them by December, alongside IT system upgrades and officer training.
  • The statute explicitly covers “virtual digital space,” allowing access during search and seizure to emails, social media, net-banking, trading accounts, cloud servers and crypto wallets, including password override when needed.
  • Officials emphasize these digital search powers are not an expansion, will be used sparingly in searches and surveys, and remain subject to confidentiality provisions and accountability under the Act.
  • Redesigned tax forms, including ITR and TDS/TCS statements, will align with the new “tax year” terminology and aim to be simpler and more prefilled, with detailed SOPs expected to set safeguards for handling seized digital data.