Know the Major Financial Reforms Set to Take Effect from April 2026

Know the Major Financial Reforms Set to Take Effect from April 2026

With the beginning of the new financial year, the government and banks are changing some rules. These changes will have an impact on tax filing, banking, fuel prices, and travel.

1. New Income Tax Law (Income Tax Act 2025)

• The Income Tax Act 2025 will be implemented from April 1, which will replace the old Income Tax Act 1961.
• Tax language will be made simple. Confusing terms like “Assessment Year” and “Previous Year” will be removed.
• Now there will be only one concept – Tax Year. This will make it easier for taxpayers to understand and file.

2. Zero tax on income up to Rs 12 lakh

• In the new tax regime, the government has given relief to the middle class. If your annual income is up to Rs 12 lakh, then you will not have to pay income tax.
• This has become possible due to the Section 87A rebate. In simple terms, salaried individuals and small business owners will see direct benefits from this.

3. Changes in TDS document formats

To make tax compliance more modern and user-friendly, some important updates have been introduced. Form 16 will now be known as Form 130, and Form 16A will be replaced by Form 131.

• These changes are meant to make tax-related paperwork more straightforward and less confusing. This will simplify the reporting process of salary and interest income.

4. Stricter rules for PAN card applications

• The rules for applying for a PAN card have now become stricter. Aadhaar will no longer be enough to prove your date of birth.
• Applicants will need to provide proper documents like a Class 10 certificate, passport, or birth certificate. This move is intended to make identity verification more reliable and accurate.

5. Possible Change in LPG Cylinder Prices

• The price of an LPG cylinder can be revised. Domestic LPG rates might be revised on 1st April due to the current US-Israel War.
• Global crude oil prices are impacted by the effect of international geopolitical tensions.

6. Changes in CNG, PNG, and Aviation Fuel Rates

• If prices increase, cab and auto fares may rise, and air ticket prices may increase.
• Daily commuting costs may go up. This could impact overall travel and transportation budgets.

7. Change in ATM withdrawal charges

• Banks like HDFC Bank have announced that from April 1, 2026, UPI ATM withdrawals will also count towards the free transaction limit. If you cross 5 free transactions, then Rs 23 will be charged on each transaction.
• Meanwhile, Bandhan Bank will give its customers 3 free transactions in metro cities and 5 free transactions in non-metro cities. Every additional transaction beyond this limit will be charged Rs 23, and if the transaction fails due to insufficient balance, Rs 25 will be charged

8. Debit card withdrawal limit reduced

• Punjab National Bank has reduced the daily cash withdrawal limit. Earlier withdrawal up to Rs 100,000 was allowed.
• Now, the withdrawal limit has been updated to Rs 50,000 to Rs 75,000. Its impact will be on people who use more cash.

9. Stricter Train Ticket Cancellation Rules

• Railways have changed the rules on ticket cancellations. The railways will now allow zero refund if tickets are cancelled within 8 hours of departure. The earlier limit was 4 hours.

10. Train Ticket Revised Refund Structure

• If you cancel between 8 and 24 hours, you will get 50% money back (the rest will be deducted).
• If you cancel between 24 and 72 hours before, then only 25% of the money will be deducted (which means a 75% refund will be given).
• If you cancel more than 72 hours in advance, cancellation charges will be levied as per the rules of Indian Railways.