By Admin 
Union Budget 2026-27: Finance Minister Nirmala Sitharaman made many big announcements in her budget speech. It also talked about changing the way common Indians file, declare and pay taxes. The Finance Minister also mentioned the new timeline, lower TCS rates, tax-free compensation rules and the introduction of a new facility to provide information for foreign assets.
These changes have been implemented to reduce the hassle and initial cash expenditure in complying with the rules and to give taxpayers more time to correct mistakes before the new Income Tax Act comes into force on April 1, 2026.
New Income Tax Act implemented
At the heart of these announcements is the implementation of the new Income Tax Act from April 1, 2026, which the government says will modernize and simplify the tax system. Ahead of this change, the filing timeline is being staggered – individuals filing ITR-1 and ITR-2 will continue to file till July 31, while non-audit business cases and trusts will get time till August 31. The deadline for revising returns will also be extended to March 31 every year, for which a small fee will be charged, which will give taxpayers more time to correct mistakes.
Overseas tour packages cut
The biggest win for consumers is the huge reduction in TCS on overseas tour packages, which is now flat at 2% without any limit compared to the earlier 5% and 20% slabs. Under LRS, the TCS rate on money sent for education and medical purposes will also be reduced from 5 percent to 2 percent, which will reduce the cash burden on families.
Gauri Puri, partner, Shardul Amarchand Mangaldas & Co, said, “Procedural compliance plays an important role for small taxpayers in this budget. Reduction in TCS rates, automated facility to get low and zero withholding tax certificates, ability to disclose foreign assets and extended deadline for filing revised returns, all these are the main examples.”
In a major relief measure, the interest paid by the Motor Accident Claims Tribunal to the common people will also now be completely tax-free and no TDS will be applicable on it, thereby ending years of uncertainty.
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