The Income-tax Act, 2025 does not put tax rates in a Schedule. Individual slab rates are in section 202, special incomes in section 194, capital gains in sections 196 to 198, company regimes in sections 199 to 204, and the annual Finance Act supplies surcharge and cess.
No Schedule of the Income-tax Act, 2025 contains tax rates. Schedule I is read with section 9(12) and deals with business connection conditions. Rates are in the sections listed below, read with the annual Finance Act.
Where the rates actually are
In the Income-tax Act, 1961 the First Schedule to the annual Finance Act carried the rate tables, which is probably why readers expect the new Act's Schedule I to do the same. It does not. Schedule I of the Income-tax Act, 2025 is the fund-management safe harbour under section 9(12).
The charging section is section 4, and it is deliberately dependent: income-tax is charged at the rate or rates that a Central Act enacts for the tax year. That Central Act is the annual Finance Act, which continues to supply surcharge and cess.
Within the Act itself, the rate provisions are gathered in Chapter XIII. The one most individuals need is section 202, the default regime, whose table runs from nil up to ₹4,00,000 to 30% above ₹24,00,000.
The Income-tax Act, 2025 takes effect from 1 April 2026 and applies from tax year 2026-27. The Income-tax Act, 1961 continues to govern every year up to 31 March 2026 because of the repeal and savings provision in section 536. The Schedule contents described here are taken from the Act as enacted, incorporating the corrigenda notified in the Gazette on 3 September 2025.
Where each provision actually sits
| Topic | Income-tax Act, 1961 | Income-tax Act, 2025 |
|---|---|---|
| Charging section | Section 4 | Section 4 |
| Individual slab rates (new regime) | Section 115BAC | Section 202 |
| Rebate | Section 87A | Section 156 |
| Special incomes — lottery, crypto, online games | Sections 115BB, 115BBH, 115BBJ | Section 194 |
| Short-term capital gains on equity | Section 111A | Section 196 |
| Long-term capital gains | Section 112 | Section 197 |
| Long-term capital gains on listed equity | Section 112A | Section 198 |
| Company concessional regimes | Sections 115BA, 115BAA, 115BAB | Sections 199, 200, 201 |
| Minimum alternate tax | Section 115JB | Section 206 |
| Unexplained income | Section 115BBE | Section 195 |
The rate provisions, one by one
Section 202 — the individual slab table
The default regime for individuals, HUFs, AOPs other than co-operative societies, BOIs and artificial juridical persons. The table is nil up to ₹4,00,000, then 5% to ₹8,00,000, 10% to ₹12,00,000, 15% to ₹16,00,000, 20% to ₹20,00,000, 25% to ₹24,00,000 and 30% above ₹24,00,000. Tax is computed at these rates unless the person exercises the option under section 202(4).
Section 156 — the rebate that decides whether anything is payable
A resident individual gets a rebate of 100% of income-tax or ₹60,000, whichever is less, where income chargeable under section 202(1) does not exceed ₹12,00,000; and 100% or ₹12,500 where total income does not exceed ₹5,00,000 outside that regime.
Sections 196, 197 and 198 — capital gains
Section 196 taxes short-term gains on STT-paid equity, equity-oriented fund units and business trust units at 20%. Section 197 taxes long-term gains generally at 12.5%, with grandfathering for land or building acquired before 23 July 2024. Section 198 taxes long-term gains on STT-paid equity at 12.5% on the amount exceeding ₹1,25,000.
Section 194 — special rates in a table
A five-column table sets 30% on lottery, betting and gambling winnings; 10% on patent royalty for a resident patentee; 10% on transfer of carbon credits; 30% on transfer of virtual digital assets; 30% on net winnings from online games; and 12.5% on profits of life insurance business.
Sections 199 to 206 — companies and co-operative societies
Section 200 carries the 22% domestic company regime, with sections 199 and 201 for manufacturing companies and sections 203 and 204 for co-operative societies, and common conditions in section 205. Section 206 carries minimum alternate tax at 15% of book profit, or 9% for an IFSC unit earning solely in convertible foreign exchange, together with alternate minimum tax.
Section 195 — the punitive rate
Unexplained credits, investments, assets, expenditure and hundi borrowings under sections 102 to 106 are taxed at 60%, with no deduction for expenditure and no set off of any loss.
Worked example
A salaried individual with total income of ₹15,25,000 in tax year 2026-27, taxed under section 202(1).
| Slab | Rate | Tax |
|---|---|---|
| Up to ₹4,00,000 | Nil | ₹0 |
| ₹4,00,001 to ₹8,00,000 | 5% | ₹20,000 |
| ₹8,00,001 to ₹12,00,000 | 10% | ₹40,000 |
| ₹12,00,001 to ₹15,25,000 | 15% | ₹48,750 |
| Total before rebate, surcharge and cess | ₹1,08,750 |
Section 156 gives no rebate here because income exceeds ₹12,00,000. Surcharge and cess are then applied as the annual Finance Act provides — none of that comes from a Schedule.
Compliance checklist
- For individual slabs, go to section 202, and test the rebate under section 156.
- For capital gains, use section 196 (short-term equity), section 197 (general long-term) and section 198 (listed equity long-term).
- For lottery, crypto and online gaming, use the section 194 table.
- For companies, use sections 199 to 205 and check section 206 for MAT.
- Add surcharge and cess from the annual Finance Act; the Act itself prescribes only base rates.
- Do not look for rates in any Schedule — none of the sixteen carries them.
Common mistakes
- Looking for a rate schedule in the Act. The Act has sixteen Schedules and none contains rates.
- Applying the ₹75,000 standard deduction outside section 202(1), where the figure is ₹50,000.
- Treating the ₹12,00,000 rebate threshold in section 156 as a slab boundary.
- Forgetting surcharge and cess, which come from the Finance Act rather than from these sections.
All sixteen Schedules of the Income-tax Act, 2025
Because the numbering is widely misquoted, the full list is reproduced below from the Act as enacted. Note that Schedules II to VII are all exemption lists, split by who is claiming rather than by what the income is.
| Schedule | Read with | Subject as enacted |
|---|---|---|
| I | section 9(12) | Conditions for certain activities not to constitute business connection in India |
| II | section 11 | Income not to be included in total income |
| III | section 11 | Income not to be included in total income of eligible persons |
| IV | section 11 | Income not to be included in total income of eligible non-residents, foreign companies and other such persons |
| V | section 11 | Income not to be included in total income of certain eligible persons including investment funds, business trusts and their unit holders |
| VI | section 11 | Income not to be included in total income of certain eligible persons in an International Financial Services Centre or having income therefrom |
| VII | section 11 | Persons exempt from tax |
| VIII | section 12 | Income not to be included in the total income of political parties and electoral trusts |
| IX | section 48 | Deduction for tea, coffee and rubber development accounts |
| X | section 49 | Deduction for Site Restoration Fund |
| XI | section 2(91) | Recognised provident funds, approved superannuation funds and approved gratuity funds |
| XII | section 51 | Minerals, and groups of associated minerals |
| XIII | section 45(2) | List of articles or things |
| XIV | section 55 | Insurance business |
| XV | section 123 | Deduction for life insurance premia, contribution to provident fund, subscription to certain equity shares, etc. |
| XVI | section 350 | Permitted modes of investment or deposits by a registered non-profit organisation |
This is an explanatory guide, not tax advice, and it does not reproduce the section in full. Read the bare text of the section before you rely on it, and check for later amendments, the Income-tax Rules made under the new Act, and CBDT circulars and notifications.