Bengaluru: The financial year 2026-27 will bring several major changes from April 1, including a new income tax law, higher toll and ATM charges, revised HRA benefits, stricter railway ticket cancellation rules and mandatory digital payment verification.

These changes are expected to affect salaried employees, taxpayers, bank customers, vehicle owners and rail passengers across the country.

New income tax law comes into force

The six-decade-old Income Tax Act, 1961, will be replaced by the Income Tax Act, 2025 and the Income Tax Rules, 2026, notified by the Central Board of Direct Taxes (CBDT). The new law comes into effect from April 1 and aims to simplify compliance and reduce litigation. The terms “financial year” and “assessment year” will now be replaced with a uniform term — tax year.

No tax up to Rs 12 lakh income

There is no change in the tax slabs for the 2026-27 tax year. Under the new regime, tax rates from 5% to 25% will apply for incomes between Rs 4 lakh and Rs 24 lakh, while income above Rs 24 lakh will attract 30% tax.

However, under Section 87A, taxpayers can claim a rebate of up to Rs 60,000, effectively making annual income up to Rs 12 lakh tax-free. Salaried employees can get relief up to Rs 12.75 lakh, including the Rs 75,000 standard deduction.

ITR revision deadline extended

The deadline for revising Income Tax Returns (ITR) has been extended till March 31 of the assessment year, instead of the earlier December 31 deadline.

However, delayed filing after December 31 will attract a penalty of Rs 1,000 for income below Rs 5 lakh and Rs 5,000 for income above Rs 5 lakh.

PAN mandatory for credit cards

From April 1, PAN will be mandatory for obtaining new credit cards. Existing cardholders will also have to link their PAN.

Aadhaar alone will no longer be sufficient for PAN-related applications, and applicants must provide a separate date-of-birth proof.

ATM withdrawal charges increased

Several banks, including HDFC Bank, PNB and Bandhan Bank, will increase charges for transactions beyond the free monthly limit.

The fee for each extra ATM transaction has been raised from Rs 21 to Rs 23. This applies to both cash withdrawals and non-financial services such as balance checks.

Form 16 replaced by Form 130

The traditional Form 16 will gradually be replaced by a more detailed Form 130.

The new TDS certificate will include complete income calculation details along with tax deductions, and will be issued annually to salaried employees and pensioners.

Two-factor authentication for digital payments

To prevent digital fraud, the RBI will make two-step verification mandatory for UPI, cards and wallet transactions.

Along with OTP, users will now need PIN or biometric verification for digital payments.

FASTag annual pass becomes costlier

The annual FASTag pass fee has been revised from Rs 3,000 to Rs 3,075 for 2026-27. This revised fee will be applicable from April 1.

Toll rates hiked on national highways

Toll charges have been increased by 3% to 5% across around 62 toll plazas, including the Bengaluru-Mysuru Expressway.

Commercial and heavy vehicles may now pay Rs 5 to Rs 25 more depending on the route. Highways including NH 44, NH 48 and NH 275 will see revised rates.

Tax relief on meal coupons

Under the new tax rules, meal coupon exemption has been increased from Rs 50 to Rs 200 per meal.

Employees using meal cards or subsidised office canteens can now claim tax-free benefits up to Rs 400 per day for two meals.

The annual tax-free limit on gift vouchers has also been increased from Rs 5,000 to Rs 15,000.

UPI cash withdrawal to count under ATM free limit

UPI-based ATM cash withdrawals through QR scan will now be counted within the monthly free ATM transaction limit, usually five times.

Beyond the free limit, the Rs 23 charge will apply.

No refund if train ticket cancelled within 8 hours

The Railways has revised cancellation norms.

Passengers cancelling tickets within 8 hours of departure will now receive no refund. Earlier, this limit was four hours.

Higher HRA exemption for Bengaluru

A major relief has been announced for salaried employees in Bengaluru.

The 50% HRA exemption, earlier available only in Mumbai, Delhi, Kolkata and Chennai, has now been extended to Bengaluru, Hyderabad, Pune and Ahmedabad.

Other cities will continue to get 40% exemption. A new declaration document, Form 124, with full landlord details will be mandatory to prevent false rent claims.

These rules will come into effect from April 1, 2026, and are expected to impact daily financial transactions and tax compliance across sectors.