Changes have also been suggested in vehicle purchase regulations. According to the proposal, providing a PAN will be mandatory for purchasing a car or a two-wheeler worth ₹5 lakh or more. Currently, providing a PAN is required for purchasing a vehicle of any price.

The Income Tax Department has released a new draft of the Income Tax Rules 2026.

Draft Income Tax Rules 2026: The CBDT (Central Board of Direct Taxes) has released the draft Income Tax Rules 2026. The draft aims to simplify and clarify income tax rules. The draft includes several important proposals that will directly impact ordinary taxpayers.

According to the draft, providing a PAN will be mandatory for deposits or withdrawals of ₹10 lakh or more in a financial year. Currently, this rule applies to deposits of up to ₹50,000 in a single day, but this has been proposed to be changed. Changes have also been suggested in vehicle purchase regulations. According to the proposal, providing a PAN will be mandatory for purchasing a car or a two-wheeler worth ₹5 lakh or more. Currently, providing a PAN is mandatory for purchasing a vehicle of any value.

Many changes in the new Income Tax Act

The draft also proposes raising the limit for payments made at hotels, restaurants, and other events, from the current ₹50,000 to ₹100,000. An increase in the limit for real estate transactions is also proposed. According to the draft, providing a PAN will be mandatory for buying, selling, or gifting property worth ₹20 lakh or more. Currently, this limit is ₹10 lakh.

The proposal also includes changes to insurance regulations. The draft states that providing a PAN will be mandatory to open an account with any insurance company. Currently, this rule applies to premiums of ₹50,000 or more.

Proposal to increase tax-free education allowance

Changes have also been suggested in the rules related to House Rent Allowance (HRA). According to the draft, the list of metro cities has been expanded. Previously, this list included Delhi, Mumbai, Chennai, and Kolkata, but now it is proposed to add Bengaluru, Pune, Hyderabad, and Ahmedabad.

The draft also calls for increasing the tax-free allowance limit for children. The tax-free education allowance for children is proposed to be increased from ₹100 to ₹3,000 per child. There are also plans to increase the limit for children's hostel allowance. According to the draft, it is proposed to increase it from the current ₹300 to ₹9,000 per child.