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The Income Tax Act 1961 was repealed under Section 536 of the new Act from April 1, 2026.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 44DA → Section 56

Special provision for computing income by way of royalties, etc., in case of non-residents

RetainedCritical - The dividing line between passive income and active business income for MNCs.

Quick Answer

Section 44DA of the Income Tax Act, 1961 (Special provision for computing income by way of royalties, etc., in case of non-residents) corresponds to Section 56 of the Income-tax Act, 2025, effective 1st April 2026. Status: Retained.

What changed for Section 44DA

Section 44DA of the 1961 Act sets out the rules on special provision for computing income by way of royalties, etc., in case of non-residents. If a non-resident earns royalty or FTS connected to a Permanent Establishment (PE) in India, it is taxed as Business Income (PGBP) rather than at flat special rates.

Under the Income-tax Act, 2025 (effective 1st April 2026), Section 44DA is retained and renumbered as Section 56 of the Income-tax Act, 2025. Retained. Ensures that foreign companies with a physical/digital presence in India cannot exploit lower treaty rates meant for passive income.

The transition impact on Section 44DA is assessed as Critical. The dividing line between passive income and active business income for MNCs.

Old Law (ITA 1961)Ch: IV-D

Sec 44DA

Provision Summary

If a non-resident earns royalty or FTS connected to a Permanent Establishment (PE) in India, it is taxed as Business Income (PGBP) rather than at flat special rates.

New Law (ITA 2025)Ch: VI

Sec 56

Provision Summary

Retained. Ensures that foreign companies with a physical/digital presence in India cannot exploit lower treaty rates meant for passive income.

Key Changes & Highlights

Definition of PE actively aligns with new digital presence rules.

Related Sections

Section 115A

Frequently Asked Questions

Which subject does Section 44DA of the 1961 Act cover?

Section 44DA of the Income Tax Act, 1961 covers special provision for computing income by way of royalties, etc., in case of non-residents. If a non-resident earns royalty or FTS connected to a Permanent Establishment (PE) in India, it is taxed as Business Income (PGBP) rather than at flat special rates.

What is the new section number for Section 44DA under the Income-tax Act, 2025?

Section 44DA of the Income Tax Act, 1961 maps to Section 56 of the Income-tax Act, 2025, effective 1st April 2026 (status: Retained). Retained. Ensures that foreign companies with a physical/digital presence in India cannot exploit lower treaty rates meant for passive income.

How does the Income-tax Act, 2025 affect Section 44DA in practice?

The transition impact for Section 44DA is rated Critical. The dividing line between passive income and active business income for MNCs.

What is new about Section 44DA under the Income-tax Act, 2025?

Definition of PE actively aligns with new digital presence rules. These points are specific to Section 44DA (Special provision for computing income by way of royalties, etc., in case of non-residents).

Disclaimer: This mapping of Section 44DA (Special provision for computing income by way of royalties, etc., in case of non-residents) to Section 56 of the Income-tax Act, 2025 is for educational and reference purposes only, based on publicly available drafts and circulars. As Section 44DA is currently marked Retained, always confirm its treatment with a qualified Chartered Accountant before filing or making compliance decisions.

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