What is the Income-tax Act, 2025 and when did it come into effect?

The Income-tax Act, 2025 replaced the Income Tax Act 1961 from April 1, 2026. It simplifies the entire direct tax framework, renumbers sections, removes redundancies, and modernizes taxation for India.

Is the Income Tax Act 1961 still valid after April 2026?

The Income Tax Act 1961 was repealed under Section 536 of the new Act from April 1, 2026. However, all assessments, appeals, and proceedings for periods before April 1, 2026 continue under the old ITA 1961 rules.

What is the new section number for Section 80C in Income Tax Act 2025?

Section 80C of the ITA 1961 maps to Section 123 of the Income-tax Act, 2025. Deductions for LIC premiums, PPF, ELSS, EPF, and home loan principal repayment continue under the new act.

What is the new section for TDS on professional fees (194J)?

Section 194J (TDS on professional and technical services) of the old Income Tax Act 1961 has been renumbered in the Income-tax Act, 2025. Use our free converter at ita1961to2025.in to find the exact new section number instantly.

How do I convert old income tax section numbers to new 2025 numbers?

Visit ita1961to2025.in and use the free section search tool. Type any old ITA 1961 section number (e.g., 80C, 194J, 139) and instantly see the new Income-tax Act, 2025 equivalent, its status, and key changes.

Is the ITA 1961 to 2025 mapping tool free for CAs and tax professionals?

Yes, completely free. The section mapper, comparison cheat sheet, PDF download, and Tax Academy blog are all free for Chartered Accountants, tax lawyers, law students, and taxpayers.

Which sections were completely deleted in the new Income Tax Act 2025?

Several redundant and overlapping sections from ITA 1961 were not carried into the Income-tax Act, 2025. Use our free converter — each section is marked as Retained, Modified, or Deleted so you can quickly check any section's status.

Can I download the ITA 1961 to Income-tax Act 2025 comparison as a PDF?

Yes! Visit the Comparison page at ita1961to2025.in/comparison to download a free cheat sheet PDF showing side-by-side mapping of key ITA 1961 sections to their Income-tax Act, 2025 equivalents.

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ITA 1961 → ITA 2025PGBP

Section 35AD → Section 37

Deduction in respect of expenditure on specified business

RetainedHigh - Major shift in infrastructure tax planning.

Quick Answer

Section 35AD of the Income Tax Act, 1961 (Deduction in respect of expenditure on specified business) corresponds to Section 37 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.

What changed for Section 35AD

The starting point is Section 35AD of the Income Tax Act, 1961 — deduction in respect of expenditure on specified business. Investment-linked tax incentive providing 100% deduction for capital expenditure incurred by specified businesses (cold chains, hospitals, hotels).

The new code maps this to Section 37: the provision is retained and renumbered as Section 37 of the Income-tax Act, 2025, applying from 1st April 2026. Sunset clause activated. Only existing eligible projects can claim residual benefits. New projects are routed through PLI (Production Linked Incentive) schemes instead of direct tax deductions.

On the ground, changes to Section 35AD carry a High impact. Major shift in infrastructure tax planning.

Old Law (ITA 1961)Ch: IV-D

Sec 35AD

Provision Summary

Investment-linked tax incentive providing 100% deduction for capital expenditure incurred by specified businesses (cold chains, hospitals, hotels).

New Law (ITA 2025)Ch: VI

Sec 37

Provision Summary

Sunset clause activated. Only existing eligible projects can claim residual benefits. New projects are routed through PLI (Production Linked Incentive) schemes instead of direct tax deductions.

Key Changes & Highlights

Phasing out of investment-linked tax deductions to clean up the tax code.

Related Sections

Section 73A

Frequently Asked Questions

What does Section 35AD of the Income Tax Act 1961 deal with?

Section 35AD of the Income Tax Act, 1961 covers deduction in respect of expenditure on specified business. Investment-linked tax incentive providing 100% deduction for capital expenditure incurred by specified businesses (cold chains, hospitals, hotels).

Where does Section 35AD of the ITA 1961 go under the Income-tax Act, 2025?

Section 35AD of the Income Tax Act, 1961 maps to Section 37 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Sunset clause activated. Only existing eligible projects can claim residual benefits. New projects are routed through PLI (Production Linked Incentive) schemes instead of direct tax deductions.

Why does the change to Section 35AD matter for taxpayers?

The transition impact for Section 35AD is rated High. Major shift in infrastructure tax planning.

What are the key changes to Section 35AD under the Income-tax Act, 2025?

Phasing out of investment-linked tax deductions to clean up the tax code. These points are specific to Section 35AD (Deduction in respect of expenditure on specified business).

Disclaimer: This mapping of Section 35AD (Deduction in respect of expenditure on specified business) to Section 37 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 35AD is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.

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