Income Tax Act 2025 vs 1961

Income Tax Act 2025 vs Income Tax Act 1961 — Section Mapping Cheat Sheet for Taxpayers

India’s income-tax framework has undergone one of the biggest structural changes in decades.

The Income-tax Act, 2025 came into effect from 1 April 2026 and replaced the Income-tax Act, 1961 for tax years beginning on or after that date. The 1961 Act, however, continues to govern earlier tax years and related pending proceedings under the transition provisions.

For taxpayers, CAs, accountants and businesses, one major change is the renumbering and restructuring of provisions.

Sections that taxpayers have used for years — such as:

Section 80C
Section 44AB
Section 139
Section 192
Section 194C
Section 194J
Section 143
Section 148

now have corresponding provisions under the Income-tax Act, 2025.

Many taxpayers therefore ask:

“Where has Section 80C gone?”

“What is the new section for tax audit?”

“What section should I quote for TDS after 1 April 2026?”

“Does Section 139 still apply?”

“Which Act should I use for FY 2025-26?”

Let’s break it down. 🚀

Income Tax Act 1961 vs Income Tax Act 2025

The Income-tax Act, 2025 reorganises the law into a more consolidated structure.

The Income Tax Department states that the 1961 Act had 819 sections and 14 schedules, while the 2025 Act contains 536 sections and 16 schedules. Several provisions have been consolidated, renumbered or moved into schedules.

The objective is not simply to change section numbers.

The new Act also:

Uses “Tax Year” instead of the earlier “Previous Year” and “Assessment Year” terminology
Consolidates several provisions
Uses tables for certain TDS/TCS provisions
Moves certain exemptions and provisions into schedules
Removes obsolete provisions
Simplifies cross-referencing

The Income Tax Department describes the new structure as a more streamlined and logically organised framework.

Which Act Applies to FY 2025-26?

This is one of the most important points.

FY 2025-26 corresponds to:

1 April 2025 to 31 March 2026

The income of this period is still governed by the Income-tax Act, 1961.

Therefore, when filing the return for FY 2025-26, taxpayers will continue to use the old Act framework.

The new Income-tax Act, 2025 applies to tax years beginning on or after 1 April 2026. The Income Tax Department specifically clarifies that returns for AY 2026-27 continue under the 1961 Act.

For example:

Period	Applicable Act
FY 2024-25 / AY 2025-26	Income-tax Act, 1961
FY 2025-26 / AY 2026-27	Income-tax Act, 1961
FY 2026-27 / Tax Year 2026-27	Income-tax Act, 2025
FY 2027-28 / Tax Year 2027-28	Income-tax Act, 2025

This distinction is extremely important during the transition.

Quick Section Mapping Cheat Sheet

Here are some of the most commonly used provisions:

Subject	Income-tax Act, 1961	Income-tax Act, 2025
Charge of Income Tax	Section 4	Section 2
Total Income	Section 5	Section 3
Residential Status	Section 6	Section 7
Salary Income	Sections 15–17	Sections 20–22
House Property	Sections 22–27	Sections 30–35
Business/Profession	Sections 28–44	Sections 40–60
Tax Audit	Section 44AB	Section 63
Capital Gains	Sections 45–55A	Sections 67–89
Other Sources	Sections 56–59	Sections 90–95
Set-off of Losses	Sections 70–80	Sections 105–119
Chapter VI-A Deductions	Sections 80A onwards	Sections 120 onwards
80C Deduction	Section 80C	Section 123
80CCD	Section 80CCD	Section 124
80D	Section 80D	Section 126
80G	Section 80G	Section 133
TDS on Salary	Section 192	Section 392
Other TDS	Sections 193–194T	Section 393
TCS	Section 206C	Section 394
Return of Income	Section 139	Section 263
Processing of Return	Section 143(1)	Corresponding provisions under new assessment framework
Scrutiny Assessment	Section 143(3)	Corresponding provisions under new assessment framework
Best Judgment Assessment	Section 144	Section 268
Search & Seizure	Section 132	Corresponding search provisions under new Act
Reassessment	Section 148	Corresponding reassessment provisions under new Act
Appeal to CIT(A)	Section 246A	Section 355
Appeal to ITAT	Section 253	Section 360
Revision by CIT	Section 263	Section 373

The mapping is a structural cross-reference, and some old provisions have been split, merged or moved rather than receiving a simple one-to-one replacement.

Section 80C → Section 123

One of the most familiar taxpayer provisions is Section 80C.

Under the new Act, the corresponding deduction provision is Section 123.

It covers eligible investments/payments such as:

Provident Fund

Life Insurance

Tuition fees

Eligible housing-loan principal

ELSS and specified investments

The Income Tax Department confirms that the ₹1.5 lakh aggregate deduction framework is retained under the corresponding provision.

Therefore:

Old Act → Section 80C

New Act → Section 123

Section 80D → Section 126

Health-insurance deduction earlier covered under Section 80D is now dealt with under Section 126.

Broadly, the provision continues to cover eligible payments such as:

Health insurance premium

‍👩‍👧 Family medical insurance

Certain payments relating to senior citizens

The section number has changed, but the taxpayer should still check the applicable conditions and limits for the relevant tax regime.

Section 80CCD → Section 124

NPS-related deductions earlier covered under Section 80CCD are mapped to Section 124.

This includes relevant provisions relating to:

Employee contribution
Employer contribution
Additional NPS contribution

Taxpayers should check the specific subsection applicable to their claim rather than simply referring to the old Section 80CCD number.

Section 80G → Section 133

Deduction for eligible donations under Section 80G has been moved to Section 133 under the new Act.

Therefore:

1961 Act → 80G

2025 Act → 133

The eligibility of the donation and the applicable deduction percentage should still be verified before claiming the deduction.

Section 44AB → Section 63

Tax audit is another important area for businesses and professionals.

Under the 1961 Act:

Section 44AB → Tax Audit

Under the 2025 Act:

Section 63 → Tax Audit

This is particularly important for:

Companies

LLPs

Proprietors

Professionals

Businesses crossing applicable turnover or other prescribed thresholds

The applicability and conditions should be checked according to the relevant tax year.

Section 139 → Section 263

Return filing is another major area where taxpayers will notice the change.

Under the 1961 Act:

Section 139 → Return of income

Under the 2025 Act:

Section 263 → Return of income

This is particularly relevant when dealing with returns for Tax Year 2026-27 onwards.

However, for FY 2025-26 / AY 2026-27, the old Section 139 framework continues to apply.

TDS — One of the Biggest Changes

TDS provisions have been substantially reorganised.

Under the Income-tax Act, 1961, taxpayers were familiar with:

Section 192 → Salary

Section 194A → Interest

Section 194C → Contractors

Section 194H → Commission

Section 194-I → Rent

Section 194J → Professional/technical fees

Section 194Q → Purchase of goods

Section 194R → Benefits/perquisites

Section 194S → Virtual Digital Assets

Under the Income-tax Act, 2025, these provisions have largely been consolidated under Section 392 and Section 393.

The Income Tax Department confirms that the old TDS provisions from Sections 192 to 194T have been consolidated into Sections 392 and 393.

Section 192 → Section 392

Salary TDS has its own provision.

Old Act:

Section 192

New Act:

Section 392

This applies to salary-related TDS for payments governed by the new Act.

Section 194A → Section 393

Interest other than securities is now covered within the table-based framework of Section 393.

Therefore:

Old → Section 194A

New → Section 393, relevant table entry

Section 194C → Section 393

Contractor payments are now covered under the relevant table entry in Section 393.

For example, the Income Tax Department’s transition guidance states that a contractor payment made after 1 April 2026 should refer to Section 393(1), Table Sl. No. 6(i), rather than old Section 194C.

Section 194J → Section 393

Professional and technical fees are also included in the consolidated TDS framework.

Old:

Section 194J

New:

Section 393, relevant table entry

This is important for:

‍💼 Professional fees

Technical services

Consultancy

Certain professional payments

The exact table entry should be checked based on the nature of payment and recipient.

Important TDS Rule After 1 April 2026

This is extremely important for businesses.

For a payment/credit occurring on or after 1 April 2026, the applicable TDS provisions are under the Income-tax Act, 2025.

For payments/credits on or before 31 March 2026, the Income-tax Act, 1961 applies.

The Income Tax Department specifically states that using old references such as 194C, 194J or 194H for transactions governed by the new Act may cause system-level validation errors.

Example:

Invoice/payment to contractor:

25 March 2026 → Old Act → Section 194C
5 April 2026 → New Act → Section 393, relevant table entry

TCS — Section 206C → Section 394

TCS provisions have also been consolidated.

Old Act:

Section 206C

New Act:

Section 394

Therefore, businesses collecting tax at source for transactions governed by the new Act should use the applicable Section 394 table entry.

HRA — Section 10(13A)

Certain exemptions that taxpayers previously identified through Section 10 have been reorganised.

For example, exemptions previously located within Section 10 are now structured through the relevant provisions and schedules under the new Act.

The new Act’s Schedule II contains several exemption-related provisions that were previously housed within Section 10.

Therefore, taxpayers should not assume that every old Section 10 exemption simply becomes one new section number.

Capital Gains — Section 45

Capital gains provisions have also been reorganised.

Old Act:

Section 45 → Chargeability of capital gains

New Act:

Section 67 → corresponding charging provision

Other capital-gain provisions are distributed across the new framework.

Therefore, when reading an old capital-gains article, assessment order or professional opinion, taxpayers may need a section-mapping reference to identify the corresponding provision under the 2025 Act.

Business Income — Sections 28 to 44

Under the 1961 Act, business and professional income was spread across Sections 28 to 44.

Under the new Act, the corresponding provisions are broadly organised across Sections 40 to 60.

This includes areas such as:

Business income

Allowable expenses

Depreciation

Business deductions

Tax audit-related provisions

The new structure groups related provisions more logically than the older framework.

Loss Set-Off & Carry Forward

Loss provisions have also been reorganised.

Under the old Act, taxpayers commonly referred to Sections 70 to 80.

The corresponding provisions under the new Act are broadly placed in Sections 105 to 119.

Importantly, losses determined under the old Act are not simply lost because the new Act came into force.

The Income Tax Department confirms that eligible brought-forward losses from tax years beginning before 1 April 2026 continue under the saving provisions, subject to the original conditions and carry-forward period.

Assessment & Scrutiny

Taxpayers are also familiar with:

Section 143(1) → Processing

Section 143(3) → Scrutiny assessment

Section 144 → Best judgment assessment

The new Act reorganises assessment provisions into a different structure.

Therefore, taxpayers receiving notices or orders under the new Act should carefully check the new section references rather than assuming that old section numbers remain applicable.

Search & Reassessment

Under the 1961 Act:

Section 132 → Search and seizure
Section 148 → Reassessment

The corresponding provisions have been reorganised under the new Act.

This is an area where taxpayers should avoid relying solely on an old section number because the new Act has restructured the assessment and investigation framework.

Appeal & Revision

Some important mappings include:

Particulars	Old Act	New Act
Appeal to CIT(A)	246A	355
Appeal to ITAT	253	360
Revision by CIT	263	373
Prosecution for failure to file return	276CC	410

These references are useful when reading notices, orders, professional articles and tax litigation material under the new Act.

Why Section Mapping Matters for Taxpayers

Section mapping is not merely useful for tax professionals.

It matters for ordinary taxpayers too.

You may encounter old section numbers in:

Old tax books

Articles

Previous ITRs

Bank documents

Audit reports

Court judgments

Tax notices

TDS certificates

Accounting software

At the same time, new documents may use the 2025 Act numbering.

Understanding both systems makes it easier to identify the applicable provision.

Old Section vs New Section — Quick Memory Chart

Here is a simple cheat sheet:

Tax Audit

44AB → 63

80C

80C → 123

Medical Insurance

80D → 126

Donations

80G → 133

Return Filing

139 → 263

Salary TDS

192 → 392

Interest TDS

194A → 393

Contractor TDS

194C → 393

Commission TDS

194H → 393

Rent TDS

194-I → 393

‍💼 Professional Fees TDS

194J → 393

Other TDS provisions

Various old sections → Section 393

TCS

206C → 394

Capital Gains

45 → 67

Appeal to CIT(A)

246A → 355

Appeal to ITAT

253 → 360

Revision

263 → 373

Do Not Assume Every Section Has a One-to-One Replacement

This is an important point.

The Income-tax Act, 2025 is not simply:

Old Section 100 → New Section 100

Old Section 194C → New Section 194C.

Many provisions have been:

Renumbered
Consolidated
Split
Moved to schedules
Rewritten into tables
Omitted where obsolete

For example, TDS provisions that were previously spread across numerous sections have been consolidated under Sections 392 and 393.

Therefore, a proper section mapping should consider the actual provision and not just the number.

Taxpayer Transition Timeline

2025-26

FY 2025-26 / AY 2026-27

Income-tax Act, 1961 continues to apply.

1 April 2026

Income-tax Act, 2025 becomes applicable to tax years beginning on or after this date.

July 2026

FY 2025-26 return is filed as AY 2026-27 under the 1961 Act.

FY 2026-27

New Tax Year terminology and Income-tax Act, 2025 framework apply.

Practical Checklist for Taxpayers

Before preparing a tax document, ask:

Which financial/tax year does it relate to?
Is the transaction before or after 1 April 2026?
Which Act applies?
Is the section reference from the 1961 Act or 2025 Act?
Has the provision been renumbered?
Has the provision moved to a schedule?
Has the provision been consolidated?
Is there a specific transition provision?

This simple checklist can prevent many errors.

Common Mistakes Taxpayers Make

Using Section 80C for a Tax Year governed by the 2025 Act
Using Section 194C for a TDS transaction after 1 April 2026
Assuming FY 2025-26 is governed by the new Act
Confusing Tax Year with Assessment Year
Treating every old section as having a simple one-to-one replacement
Using outdated TDS section numbers in new-period filings
Ignoring transitional provisions
Assuming old losses disappear after 1 April 2026
Relying on old tax software or outdated templates

The Income Tax Department has specifically highlighted the transition between the two Acts and maintains separate facilities for forms under the 1961 and 2025 Acts.

Why Businesses Choose TAXAJ

At TAXAJ, we help businesses and taxpayers navigate changes in income-tax legislation and ongoing compliance requirements.

Our services include:

Income Tax Return Filing

Tax Planning

TDS Compliance

Tax Audit

Financial Statements

Corporate Tax Compliance

Capital Gains Computation

Business & Professional Tax Advisory

Tax Reconciliation

Income Tax Notice Assistance

FEMA & International Tax Advisory

Startup & MSME Tax Advisory

Whether you are an individual taxpayer, professional, startup, MSME or established company, our team can help you understand the applicable provisions and maintain proper tax compliance.

Final Thoughts

The Income-tax Act, 2025 has significantly reorganised India’s income-tax framework.

For taxpayers, the most important lesson is:

“Do not rely on section numbers alone. First identify the applicable tax year and then identify the corresponding provision under the applicable Act.”

Remember these major mappings:

80C → 123
44AB → 63
139 → 263
192 → 392
194A → 393
194C → 393
194J → 393
206C → 394
45 → 67
246A → 355
253 → 360
263 → 373

And most importantly:

FY 2025-26 / AY 2026-27 → Income-tax Act, 1961

FY 2026-27 / Tax Year 2026-27 onwards → Income-tax Act, 2025.

The new Act does not mean that all previous tax years suddenly move to the new law. Earlier tax years and related proceedings continue to be dealt with under the 1961 Act subject to the applicable saving and transition provisions.

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Learn the new sections. Understand the transition. Stay tax compliant. 🚀📊🧾