New Delhi, March 31 -- The new Income Tax (I-T) Act is set to come into effect tomorrow, on 1 April 2026, with the new financial year 2026-27 and is likely to impact salaried employees, especially under the Old Tax regime.

The new rules provide higher exemptions for an additional four new cities besides increasing allowances for children's education and hostel expenditure, meal cards, gift coupons and conveyance, among others.

Notably, there are no changes in the income tax slabs from 1 April. This is because during Budget 2026, there was no announcement of a change in the income tax slabs under both old and new income tax regimes. In the subsequent notifications of the Income Tax Act, 2025, and Income Tax Rules, 2026, there was also no...