Three shifts define the Indian landscape this year: a brand-new Income Tax Act, a rationalised GST rate structure, and a fundamental change in how services exports are treated. Each one touches our clients directly.
The Income Tax Act, 2025 is now live
From 1 April 2026, the Income Tax Act, 2025 replaces the six-decade-old 1961 Act. The new law introduces a unified "Tax Year" concept, simplifying how income and liabilities are computed and reported.
Under the new regime, tax-free income now extends up to ₹12 lakh, while the old deduction-based regime (80C, 80D and others) remains available by choice. For most salaried and small-business taxpayers, the regime choice deserves a fresh look this year rather than carrying over the previous decision.
GST 2.0: a cleaner slab structure
The GST rate structure has been rationalised into primarily two main slabs - 5% and 18% - with a higher 40% rate reserved for select luxury and sin goods, replacing the old 5/12/18/28 architecture.
Alongside the rate changes, the GST portal now enforces hard validations: from January 2026, ITC mismatches can block GSTR-3B filing outright. Reconciliation is no longer a year-end exercise - it has become a monthly discipline.
One operational note: the mandatory Ship-To GSTIN field and voluntary e-way bill closure, originally slated for 15 June, have been postponed to 1 August 2026 - a brief reprieve to get systems ready.
The intermediary change: big news for services exporters
Budget 2026-27 fundamentally altered the place-of-supply rules for intermediary services. Services provided to overseas clients that were previously taxed as domestic supplies can now qualify as exports - meaning no GST levy, with input tax credit available.
For India-based businesses serving foreign clients - including the kind of cross-border service arrangements we regularly structure - this is a meaningful margin and cash-flow improvement, and worth revisiting existing contracts for.
Dates that matter right now
The first advance tax instalment for AY 2027-28 fell due on 15 June 2026. Monthly GSTR-3B for May was due 20 June. For companies with foreign borrowings, the monthly ECB-2 return continues through AD banks.
And for anyone bringing foreign investment into an Indian company, the discipline is unchanged: valuation, board sequencing, remittance documentation and timely RBI reporting - the fundamentals we work through with founders every month.
The theme of 2026 is systematisation: the portal now enforces what circulars once requested. Businesses with clean monthly reconciliations will barely notice. Those without will feel it at filing time.