New Delhi, Oct. 22 -- The Income Tax Act, 2025, came into effect on April 1, 2026, repealing the Income-tax Act, 1961. However, several provisions of the old law continue to apply to earlier tax years and pending matters.

This means taxpayers cannot assume that outstanding tax demands, recovery proceedings, or eligible refund claims under the old law will disappear.

Here's what the Directorate of Income Tax's FAQs on the interplay and transition from the Income-tax Act, 1961, to the Income Tax Act, 2025 reveal.

Yes. Tax liabilities raised under the 1961 Act remain payable even after its repeal. For instance, if a taxpayer received a tax demand notice for assessment year (AY) 2022-23 and has not paid it, the outstanding amount remains d...