The government is set to introduce simplified income tax return forms under the Income Tax Act, 2025 by January 2026, replacing the long-standing Income Tax Act, 1961. These new forms aim to make tax filing easier, reduce compliance burdens, and improve transparency. Refunds are being processed, with larger claims expected by December 2025. The CBDT is confident of meeting its ambitious ₹25.20 lakh crore direct tax collection target for FY26, supported by strong growth. Taxpayers should prepare for the new system, which takes effect from April 1, 2026.