Draft Income Tax Rules, 2026 Released

The government released draft rules to replace the 1962 framework, effective from April 1, 2026. Key changes include strengthening PAN usage in financial transactions, revised reporting thresholds, higher House Rent Allowance (HRA) exemptions for metros, more tax-free employee benefits, tighter insurance norms, and stricter reporting for crypto exchanges. The Income Tax Department plans to notify updated return forms by early March 2026, with some changes (e.g., data sharing) deferred. This initiative aims to streamline compliance and reduce litigation.