Rishi Tax Wizard

Introduction

With the Income Tax Act of 2025 now fully in effect for the 2026 filing season, the “who” has expanded. It’s no longer just about whether you owe tax; it’s about whether you meet the “high-value criteria.”

The Basic Exemption Limits

In 2026, the New Tax Regime remains the default. You must file a return if your total income exceeds the basic exemption limit (currently ₹3 Lakh). However, thanks to rebates, you might not pay any tax until you cross ₹7 Lakh.

Mandatory Filing (Regardless of Income)

You are legally required to file an ITR if you meet any of these 2026 triggers:

  • Foreign Assets: You hold any asset outside India (like US stocks or a foreign bank account).

  • High Electricity Bills: You paid more than ₹1 Lakh for electricity in the year.

  • Foreign Travel: You spent more than ₹2 Lakh on travel abroad for yourself or anyone else.

  • High Bank Deposits: You deposited ₹1 Crore or more in current accounts, or ₹50 Lakh in savings accounts.

  • Business Turnover: Your business sales exceed ₹60 Lakh, or professional receipts exceed ₹10 Lakh.

New Rules for 2026: The “PAN Quoting” Shift

The government has revised the limits for quoting your PAN. You’ll now need to provide it for:

  • Property Transactions: Any sale or purchase above ₹20 Lakh.

  • Cash Transactions: Aggregate cash deposits or withdrawals exceeding ₹10 Lakh in a financial year.

  • Hotel Bills: Any cash payment exceeding ₹1 Lakh.

Better Perks for the “Old Regime”

If you’re still using the Old Tax Regime, the 2026 draft rules have sweetened the deal. Children’s Education Allowance exemptions have jumped from a measly ₹100 to ₹3,000 per month, and Hostel Allowance is now ₹9,000 per month.

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