Finance Minister Nirmala Sitharaman, on 1 Feb 2026, while presenting the Interim Budget, kept the income tax slab rates unchanged for both new and old income tax regimes; however, some relief for non-residents with the exemption of Minimum Alternate Tax (MAT), who pay tax on a presumptive basis. Let’s look at the budget 2026 highlights.

Finance minister Nirmala Sitharaman proposes:

• To extend the time available for revising returns from 31st December to up to 31st March, with the payment of a nominal fee.
• To stagger the timeline for filing tax returns, individuals with ITR 1 and ITR 2 will continue to file until 31st July, and non-audit business cases or trusts are proposed to be allowed time until 31st August.
• To reduce TCS rates for education and medical purposes from 5% to 2%
• Any interest awarded by the motor accident claims tribunal to a natural person will be exempt from income tax, and any TDS on this account will be done away with.

Income Tax Slabs and Rates: Old Vs New Regime Changes

The old and new tax regimes remain unchanged. Check the income tax slabs for the old tax regime:

Under the old tax regime:

Under the new tax regime:

Conclusion:

Last year, we received significant tax relief; we must plan our finances to make the most of it.