Section 35DDA → Section 36
Amortisation of expenditure incurred under voluntary retirement scheme (VRS)
Quick Answer
Section 35DDA of the Income Tax Act, 1961 (Amortisation of expenditure incurred under voluntary retirement scheme (VRS)) corresponds to Section 36 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 35DDA
Provision Summary
Allows an employer to deduct the amount paid to an employee under a VRS in 5 equal annual installments.
Sec 36
Provision Summary
Retained. Helps companies manage the massive one-time payout tax impact during workforce rightsizing.
Key Changes & Highlights
- No change.
Frequently Asked Questions
What does Section 35DDA of the Income Tax Act 1961 deal with?
Section 35DDA (Amortisation of expenditure incurred under voluntary retirement scheme (VRS)) Allows an employer to deduct the amount paid to an employee under a VRS in 5 equal annual installments.
What is the new section number for Section 35DDA under the Direct Tax Code 2025?
Section 35DDA of the ITA 1961 maps to Section 36 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 35DDA under the new tax code?
Section 35DDA is marked as "Retained" with status "Active". Impact: Medium - Standard HR and corporate finance provision.
What are the key changes to Section 35DDA under DTC 2025?
No change.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
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