New Delhi, Feb 1 (NationPress) To facilitate a better living experience for taxpayers, the Union Budget 2026-27 presented on Sunday has unveiled a series of proposals related to direct taxation, with the Income Tax Act, 2025, set to come into effect on April 1, 2026.

The new regulations and forms are expected to be released soon, giving taxpayers sufficient time to familiarize themselves with the new requirements. The redesigned forms aim to simplify understanding and compliance for everyday individuals.

Finance Minister Nirmala Sitharaman also suggested that any interest granted by the Motor Accident Claims Tribunal to individuals will be exempt from Income Tax, eliminating any TDS related to this.

The Budget for 2026-27 proposes a reduction in the TCS rate on the sale of overseas tour program packages from the current rates of 5 percent and 20 percent to just 2 percent, applicable without any amount stipulation.

Additionally, it seeks to lower the TCS rate for education and medical expenses under the Liberalised Remittance Scheme (LRS) from 5 percent to 2 percent.

The document states, 'The supply of manpower services will now be explicitly included within contractor payments for TDS purposes to eliminate confusion. TDS on these services will be set at either 1 percent or 2 percent.

Furthermore, a new scheme for small taxpayers is proposed, allowing a rule-based automated process to secure a lower or nil deduction certificate without needing to file an application with the assessing officer.

To enhance convenience for taxpayers holding securities in various companies, the budget proposes enabling depositories to accept Form 15G or Form 15H from investors and submit it directly to relevant companies. Additionally, the deadline for revising returns will be extended from December 31 to March 31 for a nominal fee, as outlined in the Budget.

The Budget also suggests staggering the timeline for tax return filings. Individuals submitting ITR 1 and ITR 2 will continue to file until July 31, while non-audit business cases or trusts will have until August 31.

For non-residents selling immovable property, TDS is proposed to be deducted and paid via the resident buyer’s PAN-based challan, negating the need for a TAN.

To tackle practical challenges faced by small taxpayers, including students, young professionals, and relocated NRIs, a one-time, six-month foreign asset disclosure scheme will be introduced for declaring income or assets below a specific threshold.

This scheme applies to two categories of taxpayers: (A) those who failed to disclose their overseas income or assets, and (B) those who declared their overseas income and/or paid taxes but did not report the assets acquired.