Income Tax: A New Act and Revised Perks
The biggest change on the tax front is the introduction of the Income Tax Act, 2025, which has come into effect from April 1, 2026, replacing the old 1961 Act. The primary goal is to simplify the language and reduce legal disputes. While tax slab rates
for the 2026-27 tax year have not changed, the new tax regime continues to be an attractive option for many. Under this regime, individuals with a taxable income up to ₹12 lakh can potentially pay zero tax, thanks to an enhanced rebate. For salaried taxpayers, a standard deduction of ₹75,000 can push this tax-free income limit to ₹12.75 lakh. Additionally, several perquisite values and allowances under the old tax regime have been updated to reflect current economic conditions. For instance, the exemption for House Rent Allowance (HRA) at 50% of basic salary now extends to residents of Bengaluru, Pune, Hyderabad, and Ahmedabad, in addition to the four metros. The taxable value of company-provided cars has been revised, and the tax-free limit for employer-provided gifts has been increased from ₹5,000 to ₹15,000 annually.
KYC: Simpler, Fairer, and More Accessible
The Reserve Bank of India (RBI) has overhauled the Know Your Customer (KYC) norms to make them more customer-friendly and prevent accounts from being frozen unexpectedly. Banks must now send multiple reminders, including at least one by post, before a customer's KYC is due and after it has expired. For customers classified as 'low-risk', banks cannot freeze accounts immediately if an update is pending; they are given a grace period of up to one year from the due date or June 30, 2026, whichever is later. A major move towards accessibility allows local business correspondents—including kirana shops and self-help groups—to help customers with their KYC updates. Furthermore, if your details have not changed, a simple self-declaration is sufficient, eliminating the need for fresh documentation. Digital channels like Aadhaar OTP and Video-based Customer Identification Process (V-CIP) are also being encouraged for easier updates from anywhere.
Credit Cards and Banking: Tighter Rules, Better Protection
Several changes have been introduced to regulate credit cards and protect consumers. Effective July 1, 2026, the RBI has implemented a new framework to curb the mis-selling of financial products by banks. Customers who are mis-sold a product will be entitled to a full refund and compensation for any losses. In another significant move, all digital payments, including credit card transactions, now require two-factor authentication for enhanced security. Banks are also tightening perks; for example, HDFC Bank now requires a minimum quarterly spend of ₹60,000 for complimentary domestic airport lounge access. From a compliance perspective, a Permanent Account Number (PAN) is now mandatory for all new credit card applications.
Investing: SEBI Introduces Pro-Investor Reforms
The Securities and Exchange Board of India (SEBI) has rolled out reforms to improve transparency and protect retail investors. In a significant move announced in June 2026, SEBI is reintroducing open market buybacks through stock exchanges from August 1, 2026, with new safeguards. The regulator has also formally defined a “retail individual investor” as someone who bids for debt securities up to a value of ₹2 lakh. To encourage broader participation in debt markets, issuers are now permitted to offer incentives like additional interest or discounts to retail investors, senior citizens, and women, among others. For IPOs, disclosure requirements for companies have been enhanced, forcing them to be more transparent about financials, risks, and related-party transactions, which empowers investors to make more informed decisions.
