Income-tax Act 2025 Changes for NRIs: Tax Year, Sections & Forms

Key points

The Income-tax Act, 2025 applies from 1 April 2026. 'Tax year' replaces 'previous year' and 'assessment year'.
NRI TDS moved from section 195 to section 393(2), and lower-TDS certificates from Form 13 to Form 128.
Forms 15CA/15CB for remittances are now Forms 145/146.
Residency rules, tax rates and treaty benefits are broadly unchanged.

From 1 April 2026, India's income tax is governed by the Income-tax Act, 2025, which replaced the Income-tax Act, 1961 after more than six decades. For NRIs the tax rates are broadly unchanged. What changes is the vocabulary, the section numbers and the form numbers you'll see on bank letters, TDS certificates and the e-filing portal.

"Tax year" replaces previous year and assessment year

The old law used two years: income earned in the previous year (e.g. FY 2025-26) was assessed in the assessment year (AY 2026-27). The new Act uses a single tax year, the same 1 April to 31 March period in which you earn the income. Income earned between 1 April 2026 and 31 March 2027 is "tax year 2026-27".

Income earned up to 31 March 2026 is still taxed under the 1961 Act. If you're filing a return for FY 2025-26, the old section numbers still apply to that return.

Section numbers NRIs will see most

What it covers	1961 Act	2025 Act
Residential status	Section 6	Section 6
TDS on payments to non-residents (property sale, rent, NRO interest)	Section 195	Section 393(2)
Lower or nil TDS certificate	Section 197	Section 395
Nil-TDS declaration (residents only)	Form 15G / 15H	Declaration under section 393(6)

Forms that have been renumbered

Purpose	Old form	New form
Apply for a lower or nil TDS certificate	Form 13	Form 128
Declaration before sending money abroad	Form 15CA	Form 145
Chartered accountant's certificate for remittance	Form 15CB	Form 146

The Income-tax Rules, 2026 renumbered many other forms too. When a bank or buyer quotes an old form number, ask which new form they mean. The e-filing portal shows both names during the transition.

What hasn't changed for NRIs

Day-count tests for residential status: 182 days, 60/365 days, the 120-day rule and deemed residency. Check your status.
Tax rates: new-regime slabs (nil to ₹4 lakh, rising to 30% above ₹24 lakh), 12.5% on long-term property gains without indexation, and 31.2% TDS on NRO interest and rent.
NRE and FCNR interest is still tax-free for non-residents.
Tax treaties (DTAAs) still apply, with a Tax Residency Certificate and Form 10F.

Budget 2026 changes worth knowing

Resident individuals buying property from an NRI were announced to be able to deposit TDS with their PAN instead of a TAN, from 1 October 2026. This removes a common delay in NRI property sales. Confirm the procedure your buyer's bank or CA uses.
New-regime slabs and the ₹75,000 standard deduction for salaried people were left unchanged.

Try the calculator

Residential Status CalculatorCheck if you're an NRI, RNOR or resident this tax year Property Sale TDS CalculatorTDS a buyer must deduct when you sell property in India

Frequently asked questions

When did the Income-tax Act 2025 come into force?

On 1 April 2026. It applies to income earned from tax year 2026-27 onward. Income up to 31 March 2026 is still dealt with under the 1961 Act.

Did tax rates for NRIs change under the new Act?

Not materially. Slab rates, the 12.5% long-term capital gains rate on property and the 31.2% TDS on NRO interest and rent carried over.

What is section 195 called now?

TDS on payments to non-residents now sits in section 393(2) of the Income-tax Act, 2025.

Is Form 13 still used for lower TDS certificates?

For applications from 1 April 2026, use Form 128 under section 395, which replaces Form 13 under section 197.

Selling property or owed a refund?

A chartered accountant who works with NRIs can get a lower-TDS certificate, file your return and handle repatriation paperwork.

Sources

This guide is general information based on the law as at 25 October 2026, not tax or legal advice.