Income-tax Act 2025 & Draft Rules 2026 | Biggest Changes Explained | TDS | Forms | NPO | Crypto

Renumbering of Income-tax Forms under Draft IT Rules, 2026

One of the most structural reforms proposed under the Draft Income-tax Rules, 2026 is the complete renumbering of frequently used income-tax forms. While the compliance framework largely remains intact, the numbering system has been modernised and reorganised to align with the new Income-tax Act, 2025.

This change replaces forms prescribed under the Income-tax Rules, 1962 with newly numbered forms for improved systematic referencing.

🔹 A. Tax Audit & Certification Forms

Forms 3CA/3CB/3CD → Form 26
(Now structured into 55 segment-wise clauses)

Transfer Pricing Audit Report (3CEB) → Form 48

MAT Report (29B) → Form 66

Tax Residency Certificate (10FA) → Form 42

DTAA Declaration (10F) → Form 41

The change primarily impacts Chartered Accountants and tax professionals who will need to transition to the new numbering structure.
🔹 B. PAN & Registration Forms

PAN (Indian citizens/companies) – 49A → Form 94

PAN (Non-residents/foreign entities) – 49AA → Form 95

Provisional Registration/Approval – 10A → Form 104

NGO Registration/Renewal – 10AB → Form 105

These updates affect individuals, companies, and non-profit institutions applying for tax registrations.

🔹 C. Trusts & Charitable Institutions

Accumulation of Income – Form 10 → Form 109

Audit Report of Trust/Society/Sec-8 Company – 10B/10BB → Form 112

Statement of Donation (80G) – 10BD → Form 113

Certificate to Donor – 10BE → Form 114

The objective is structural uniformity across charitable compliance reporting.D. Appeals & Litigation Forms

Appeal before CIT(A) – Form 35 → Form 99

Appeal before ITAT – Form 36 → Form 115

ITAT Cross Objection – 36A → Form 116

Litigation procedures remain the same; only form numbers are updated.

🔹 E. TDS/TCS Compliance Forms

Salary TDS Return – 24Q → Form 138

TDS (Resident, non-salary) – 26Q → Form 140

TDS (Non-resident) – 27Q → Form 144

TCS Return – 27EQ → Form 143

Lower/Nil TDS Certificate – Form 13 → Form 128

Additionally:

Form 26AS → Form 168

15CA (Foreign Remittance) → Form 145

15CB (CA Certificate) → Form 146

SFT (61A) → Form 165

This renumbering requires systematic update in tax software, compliance manuals, and professional references.

2️⃣ TDS & TCS Provisions under Income-tax Act, 2025

The new Act consolidates and restructures TDS/TCS provisions under a newly organized chapter.

🔹 Section-wise Framework

Section 392 – TDS on Salary

Section 393 – TDS other than salary

Section 394 – TCS

Section 395 – TDS/TCS Certificates

Section 396 – Credit of TDS/TCS

Section 397 – Compliance & Reporting

Section 398 – Interest, Fees & Penalties

Section 399 – Processing of Statements

Section 400 – Power to Relax

Section 401 – Bar against Direct Demand

Section 402 – Interpretation

Key Observations:

Rates largely remain unchanged.

Structural simplification and consolidation introduced.

Compliance references updated.

🔹 Key TDS Highlights

Salary TDS continues based on applicable slab rates.

Non-salary TDS includes professional fees, rent, commission, interest, dividend, contractors.

1% TDS on Virtual Digital Assets continues.

Higher TDS for non-filers continues.

Property transactions, e-commerce, benefits/perquisites, and cash withdrawals retained.

🔹 Key TCS Highlights

All TCS provisions consolidated under Section 394.

LRS transactions segregated between education/medical and other purposes.

Overseas tour packages subject to flat TCS.

Specified goods (scrap, minerals, liquor, tendu leaves) continue under revised framework.

3️⃣ Amendments to Recognised Provident Funds (Schedule XI)

To align Income-tax provisions with the EPF Act, 1952 and EPF Scheme, 1952, rationalisation measures are proposed.

🔹 Major Proposals

Removal of redundant restrictions where unified ₹7.5 lakh employer contribution ceiling already exists.

Recognition limited only to EPF Act exempted funds.

Removal of 12% salary excess deeming taxation rule.

Removal of differential limits for employee-shareholders.

Removal of 50% mandatory Government securities investment cap.

Impact:

Reduction of duplication.

Greater flexibility in PF investment.

Simplified compliance for employers and PF trusts.

Effective from 1 April 2026 (AY 2026-27).

4️⃣ Merger of Registered Non-Profit Organisations (Sections 352 & 354A)

Currently, tax on accreted income applies when a registered NPO merges with a non-registered or dissimilar-object entity.

🔹 Proposed Insertion: Section 354A

Section 352 will not apply if:

The transferee NPO has similar objects, AND

Prescribed merger conditions are fulfilled.

Tax Applies If:

Merger with non-registered entity.

Similar-object merger but conditions not met.

Dissimilar objects.

This brings alignment with earlier provisions under section 12AC.

Effective from AY 2026-27 onwards.

5️⃣ Crypto-Asset Reporting – Section 509

AND Many more

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