Income Tax 2025: New Slabs, Filing Guide & Bill Explained

The Indian income tax system is entering a new era in 2025, marked by simplified laws, revised tax slabs, and digital-first filing processes. With the Income Tax Bill 2025 focusing on clarity and transparency, taxpayers can expect a much easier compliance journey.

This comprehensive guide covers tax slab rates for FY 2025-26, the Income Tax Bill 2025, CBDT updates, and a step-by-step guide for filing returns.

1. Income Tax Slab Rates FY 2025-26

Income Tax Slab Rates FY 2025-26

The new regime is designed to ease tax calculation with fewer slabs and a higher zero-tax limit.

Revised Slabs Under the New Tax Regime:

₹0 – ₹4 lakh: 0% (No Tax)
₹4 – ₹8 lakh: 5%
₹8 – ₹12 lakh: 10%
₹12 – ₹16 lakh: 15%
₹16 – ₹20 lakh: 20%
₹20 – ₹24 lakh: 25%
₹24 lakh and above: 30%

Additionally, the standard deduction is raised to ₹75,000, effectively increasing the zero-tax threshold to ₹12.75 lakh.

Old vs New Regime

The old regime with exemptions (HRA, 80C) still exists, but the new regime is now the default. For salaried taxpayers, comparing both regimes before filing is essential.

2. The Income Tax Bill 2025 Simplified

The Income Tax Bill 2025 Simplified

The Income Tax Bill 2025 replaces the 1961 Act to reduce complexity:

Chapters reduced: 47 → 23
Sections reduced: 819 → 536
Plain English drafting for easier interpretation
No changes in tax rates or capital gains

This change eliminates dense legal language, making taxation more transparent for individuals and businesses.

Read official coverage:

➡ LiveMint: Income Tax Bill 2025 Simplified

3. CBDT Updates & Processing Relief

The Central Board of Direct Taxes (CBDT) announced extended timelines for ITR processing.

ITRs previously marked invalid due to technical errors can now be corrected and processed until 31 March 2026.

This move aligns with CBDT's approach of "enforcement with empathy".

Full report:

➡ Economic Times: CBDT Processing Relief

4. Mandatory ITR Filing in 2025

Even if your income is below ₹12 lakh, filing an ITR is mandatory if you:

Hold foreign income/assets.

Make bank deposits over ₹1 crore.

Spend ₹10 lakh+ on credit cards annually.

Earn agricultural income above ₹5,000.

The government uses data analytics to detect non-filers, so compliance is crucial.

5. How to File Income Tax Return (ITR) Online

(Image Prompt: Step-by-step infographic of ITR filing process on a laptop and smartphone)

Here’s a quick e-filing guide:

1️⃣ Visit the Income Tax Portal

2️⃣ Log in using PAN/Aadhaar or net banking credentials

3️⃣ Select “e-File” → “Income Tax Return”

4️⃣ Choose assessment year and regime (old/new)

5️⃣ Enter income, deduction, and tax details accurately

6️⃣ Preview, submit, and e-verify within 30 days

6. Tax Filing Tips for FY 2025-26

Compare old vs new regimes before choosing.

Ensure PAN-Aadhaar linking to avoid penalties.

Keep proofs of deductions ready for audit.

Provide correct bank details for faster refunds.

File well before the deadline (15 Sept 2025) to avoid late fees.

7. Key Features of the Income Tax Bill 2025

Plain language drafting eliminates legal jargon.

Simplified forms for individuals and MSMEs.

Digital-first filing focus for seamless compliance.

Faster refunds and improved grievance redressal system.

8. Official Links & Resources

For reliable information and tools:

FAQs on Income Tax 2025

Q1: What is the new zero-tax limit?

The zero-tax limit is ₹12 lakh (₹12.75 lakh with deductions) under the new regime.

Q2: When is the deadline to file ITR for FY 2024-25?

The last date is 15 September 2025, per CBDT.

Q3: Does the Income Tax Bill change rates?

No. The bill simplifies language but retains current rates.

Q4: Which regime is better – old or new?

If you have multiple deductions (HRA, 80C, etc.), the old regime may be beneficial. Otherwise, the new regime offers lower rates with no exemptions.

Conclusion

The Income Tax 2025 reforms are designed to simplify compliance, raise transparency, and reduce litigation. With higher zero-tax thresholds, CBDT reliefs, and a streamlined filing process, taxpayers can now file with confidence.

Stay updated through the Income Tax Portal and file early to avoid last-minute issues.

Quick Tax Calculator Table (Income vs Tax)"

💰 Trusted Income Tax Calculator (FY 2025-26)

Enter Annual Income (₹): Select Tax Regime:

📊 Trusted Tax Slabs (FY 2025-26)

Income Range (₹)	New Regime Rate	Old Regime Rate
0 – 2.5 lakh	0%	0%
2.5 – 5 lakh	0%	5%
5 – 7.5 lakh	5%	20%
7.5 – 10 lakh	10%	20%
10 – 12 lakh	10%	30%
12 – 15 lakh	15%	30%
15 – 20 lakh	20%	30%
20 – 24 lakh	25%	30%
24 lakh & above	30%	30%

Source: CBDT & Income Tax Dept (FY 2025-26)

Income Tax 2025: Slabs, Bill, Filing & CBDT Updates