Salary taxation is restructured rather than merely renumbered. The 1961 Act used sections 15, 16 and 17; the Income-tax Act, 2025 uses sections 15 to 19, and section 19 pulls in the retirement exemptions that used to live in section 10.
Quick answer: the mapping
| Income-tax Act, 1961 | Subject | Income-tax Act, 2025 |
|---|---|---|
| 15 | Salaries — charge | 15 |
| 17 | Income from salary | 16 |
| 17 | Perquisite | 17 |
| 17 | Profits in lieu of salary | 18 |
| 16 | Deductions from salaries (including standard deduction) | 19 |
| 10(10) | Gratuity | 19 |
| 10(10A) | Commuted pension | 19 |
| 10(10AA) | Leave encashment | 19 |
| 10(10B) | Retrenchment compensation | 19 |
| 10(10C) | Voluntary retirement | 19 |
| 192 | TDS on salary | 392 |
The Income-tax Act, 2025 received Presidential assent on 21 August 2025 and takes effect from 1 April 2026. The Income-tax Act, 1961 continues to govern every tax year up to 31 March 2026, and all assessments, appeals, penalties and prosecutions relating to those years are completed under the old Act by virtue of the repeal and savings provision in section 536. The mapping on this page is drawn from the section-wise concordance published with the Act, including the corrigenda notified in the Gazette on 3 September 2025.
What the 1961 provision did
Section 15 charged salary, section 16 gave the standard deduction, entertainment allowance and professional tax deduction, and section 17 defined salary, perquisite and profits in lieu of salary. Gratuity, commuted pension, leave encashment, retrenchment compensation and VRS receipts were exempt under separate clauses of section 10.
Where it sits in the Income-tax Act, 2025
Section 15 charges salary. Section 16 is “Income from salary”, section 17 is “Perquisite” and section 18 is “Profits in lieu of salary” — the three limbs of old section 17 become three sections. Section 19, “Deductions from salaries”, carries old section 16 and the retirement exclusions of sections 10(10), 10(10A), 10(10AA), 10(10B) and 10(10C).
What actually changed
- Section 17 is split into three. Salary, perquisite and profits in lieu of salary each get their own section, which makes perquisite valuation easier to cite.
- Retirement benefits move into the salary computation. Instead of hunting through section 10, the gratuity, pension commutation, leave encashment, retrenchment and VRS treatment is read with section 19.
- The standard deduction sits in section 19, together with the other salary deductions.
- TDS on salary is section 392, which also carries section 192A on the accumulated provident fund balance.
What to do about it
- Payroll and Form 16 logic should map to sections 15 to 19 and to section 392 for deduction.
- Perquisite valuation references should point to section 17 of the new Act.
- Retirement settlement working papers should cite section 19 rather than clauses of section 10.
The sections around it in the new Act
Renumbering is easier to absorb in context. The table below lists the neighbouring provisions of the Income-tax Act, 2025 with the 1961 sections each of them carries forward, so you can see where this provision sits and what moved with it.
| New section (2025) | Provision | Corresponding 1961 section(s) |
|---|---|---|
| 15 | Salaries | 15 |
| 16 | Income from salary | 17 |
| 17 | Perquisite | 17 |
| 18 | Profits in lieu of salary | 17 |
| 19 | Deductions from salaries | 10(10), 10(10A), 10(10AA), 10(10B), 10(10C), 16 |
How to read a section mapping
- A corresponding section is not always an identical section. Where several 1961 sections map to one new section, conditions that used to sit apart are now read together.
- Where one 1961 section maps to several new sections, the old provision was split, and each new section carries only part of what you used to cite.
- Some new sections have no 1961 equivalent at all — the registered non-profit code in sections 332 to 355 is the largest example.
- Always cite by year. The Act that applies is decided by the tax year in question, not by the date you are writing on.
This page is a structural mapping guide, not tax advice. A corresponding section is not always an identical section — several provisions were merged, split or re-worded when they were carried over. Always read the actual text of the new section before relying on it, and check for later amendments, rules and CBDT notifications.