New GST & Income Tax Rules for FY 2026-27: A Quick Guide

Key changes in tax slabs, TDS thresholds, and GST filing deadlines every business owner and CA should know.

Income Tax Slab Changes

The new regime now offers a higher basic exemption and re-calibrated slab rates. Standard deduction limits have been increased, and the rebate threshold under Section 87A has been revised upward. The old regime remains available but with fewer incremental benefits. For salaried individuals, the new regime is increasingly attractive—but those with significant HRA, LTA, and 80C deductions should still run both calculations. Use Finwiser's tax calculator to compare regimes side by side before making your election.

TDS & TCS Updates

Threshold limits for TDS on rent (Section 194-I), professional fees (Section 194J), and commission (Section 194H) have been revised upward, reducing compliance burden for small transactions. New TCS provisions for overseas remittances under LRS and high-value purchases require sellers and banks to collect tax at source beyond specified limits. The TDS rate on e-commerce transactions has also been rationalised. Businesses must update their payroll and vendor-payment systems immediately to reflect these changes.

GST Rate Rationalisation

The GST Council has merged several rate categories and removed exemptions on certain services including certain food-delivery and SaaS subscriptions. The inverted duty structure correction for textiles and footwear continues to evolve. Businesses need to update their HSN/SAC mappings, billing software, and ERP masters to reflect the new rates from the applicable date. Failure to charge the correct rate can lead to demand notices, interest, and penalty.

Input Tax Credit (ITC) Changes

ITC matching rules have been tightened further. GSTR-2B is now the definitive source for ITC claims—any credit not reflected there will be auto-reversed. Businesses must reconcile their purchase register with GSTR-2B monthly, not just at year-end. The time limit for claiming ITC has been clarified: it's the earlier of the annual return filing date or November 30 of the following year. Late vendor filing now directly impacts your cash flow.

Filing Calendar & Deadlines

GSTR-1 and GSTR-3B due dates have been staggered differently for QRMP vs monthly filers. Annual return (GSTR-9) and reconciliation statement (GSTR-9C) thresholds may change. CMP-08 dates for composition dealers remain quarterly. Mark every deadline in your compliance calendar—late filing penalties are ₹50/day for GSTR-3B (₹20/day for nil returns) plus 18% interest on outstanding tax. CompliTrack can automate these reminders across all your entities.

Advance Tax & Self-Assessment

Advance tax installment dates remain 15 June, 15 September, 15 December, and 15 March. The percentages (15%, 45%, 75%, 100%) are unchanged, but with new slab rates, your quarterly liability will differ. Interest under Sections 234B and 234C applies if you under-pay. Use estimated income projections updated quarterly to avoid surprises. For presumptive taxation (44AD/44ADA), the entire advance tax is due by March 15.

Compliance Automation

With 30+ filings annually, manual tracking is unsustainable. Modern compliance tools auto-populate returns from ERP data, run validation checks, and flag mismatches before filing. Automated reconciliation between books, GST portal, and 26AS/AIS statements catches discrepancies early. Invest in automation now—the cost is a fraction of the penalties and interest you'll save.

Action Items for FY 2026-27

Update payroll systems for new TDS rates by April. Revise GST invoicing templates and HSN mappings. Recalculate advance tax instalments under the chosen regime. Brief your team on timeline changes. Review vendor GSTIN compliance to protect your ITC. Schedule a mid-year health check in September to course-correct before the rush of March compliance.