The new income tax bill 2025 will simplify the definition of the “tax year”

The 2025 new income tax bill, which is scheduled to be presented at Lok Sabha this week, has received the approval of the Council of Ministers and is preparing to bring significant changes to the tax framework in India.

One of the main updates is to replace the term “evaluation year” with the “tax year”, with the aim of simplifying the taxpayer understanding.

According to the draft law, the “tax year” will be defined as the 12 -month fiscal period starting from April 1. For newly established companies or newly emerging income sources, the tax year will start from the date of preparation or income generation and income generation and end on March 31.

This change is expected to provide tax and simplified accounts for individuals and companies alike.

The proposed legislation, which extends to 622 pages, seeks to replace the income tax law for six decades for the year 1961. Once approved, it will be known as the income tax law, 2025, and it is expected that it will enter into force from April 1, 2026 The draft law aims to update the tax system In India, which makes it more compatible with contemporary economic facts.

Finance Minister Nermalla Sitramman announced the introduction of this bill during the July budget session last year, highlighting its importance in simplifying tax compliance and enhancing a more suitable environment for taxpayers. This step is seen as an important step towards repairing the tax infrastructure of India, ensuring more transparency and the ease of understanding taxpayers throughout the country.

With these changes, the government aims to reduce complications and create a more efficient tax system, paving the way for a smoother financial ecosystem.