Top Income Tax Changes You Need to Know in July 2025
The Union Budget of India 2025 has brought significant changes to the income tax structure. From updated tax slabs to increased deductions and a new default tax regime, these reforms are designed to simplify the system and reduce the tax burden for many individuals. Whether you are a salaried employee or a small business owner, understanding these updates is essential to avoid penalties and optimise your savings. Startup Portal Business Service is here to guide you through every step of this new tax environment. In this blog, we cover the most important income tax changes effective from July 2025 and what actions you need to take.
New Tax Regime Becomes the Default (From FY 2025-26):
From 1st April 2025, the new tax regime will become the default option for all taxpayers in India. This means your income will automatically be assessed under this regime unless you opt for the old one. The new regime offers reduced tax rates but removes most deductions and exemptions. However, with increased rebates and a higher standard deduction for 2025, it may benefit many middle-income taxpayers. For personalised assistance on choosing the right regime, Startup Portal Business Service can help with ITR E-Filing in Pune, analyse your income &investment structure.
Updated Income Tax Slabs Under New Regime (Effective July 2025):
The revised tax slab for India under the new regime is now more structured. Here are the latest income slabs. Annual Income Tax Rate:
- Up to ₹4,00,000 – NIL
- ₹4,00,001 – ₹8,00,000 – 5%
- ₹8,00,001 – ₹12,00,000 – 10%
- ₹12,00,001 – ₹16,00,000 – 15%
- ₹16,00,001 – ₹20,00,000 – 20%
- ₹20,00,001 – ₹24,00,000 – 25%
- Above ₹24,00,001 – 30%
This revised structure is aimed at bringing progressive taxation while offering relief to low and middle-income earners.
Income Up to ₹12 Lakh Now Tax-Free (With Rebate & Deduction):
With the current tax rebates and deductions under the new regime, many individuals can now make their income up to ₹12 lakh effectively tax-free. Here’s how:
- The rebate under Section 87A has been expanded.
- The standard deduction has been increased to ₹75,000.
- No tax for income up to ₹4 lakh.
- Lower rates for middle slabs reduce the overall liability.
If you have investments and salaried income, the overall relief can be significant. Taxpayers in this range must evaluate their benefits carefully. Startup Portal Business Service offers tools and expert advice to help you maximise these benefits.
Standard Deduction Increased to ₹75,000:
The government has raised the standard deduction for 2025 from ₹50,000 to ₹75,000. This applies to both salaried individuals and pensioners, across regimes. It reduces the gross taxable income, resulting in a lower tax bill. This move is especially beneficial for those not claiming other deductions like 80C or HRA.
Old vs New Tax Regime: What's Better for You in 2025?
Choosing the right tax regime can help you save more. But which one is better?
Go with the Old Regime if:
- You claim multiple deductions (like 80C, 80D, HRA, and home loan interest).
- You have investments in PPF, LIC, NPS, or ELSS.
Choose New Regime if:
- You don’t have many deductions or don’t want to maintain records.
- Your income is ₹8–₹12 lakh and you want lower rates and simplicity.
- You prefer hassle-free filing and straightforward computation.
The decision depends on your income structure, exemptions, and deductions. If you’re confused, consult a tax advisor or try an online calculator. Startup Portal can help you run both scenarios and choose the most tax-efficient route. In addition to tax filing, we also offer GST Return Filing Services in Pune to ensure complete compliance for individuals and businesses alike.
Form 10-IEA: Mandatory for Opting into the Old Regime:
If you want to opt into the old tax regime, you must file Form 10-IEA before filing your Income Tax Return. Key Points:
- Applicable from FY 2025-26.
- The form must be filed online before the ITR due date.
- Required every year for salaried individuals switching from the new regime.
Failing to submit this form will result in your income being taxed under the default new regime.
New Income Tax Bill 2025: Structural & Legal Reforms:
The Income Tax Bill 2025 proposes a complete overhaul of the 1961 Income Tax Act.
Highlights:
- Simpler and clearer language.
- Removal of outdated and complex provisions.
- Focus on transparency, clarity, and ease of compliance.
Aims to encourage voluntary compliance and reduce litigation. This step will make the tax laws more accessible, especially for startups, freelancers, and small business owners. If you’re looking for simplified support with compliance and filings, Startup Portal Business Service is ready to assist.
Other Key Changes Introduced in Budget 2025:
Apart from the core changes in the tax regime, the Union Budget India 2025 introduced several updates:
- Updated professional tax slab for certain states.
- Single common ITR form for most individual taxpayers.
- Tighter norms for reporting high-value transactions.
- New TDS provisions on crypto transactions.
- Simplified ITR verification and refund processing timeline.
These reforms reflect the government’s effort to make tax administration more efficient and technology-driven.
What Taxpayers Must Do in July 2025?
Here’s what you should be doing in July 2025 to stay compliant:
- Review your income structure.
- Compare both tax regimes.
- Submit Form 10-IEA if opting for the old one.
- Claim the correct standard deduction.
- Gather all required documents like Form 16, investment proofs, etc.
- File your ITR before the due date.
- Consult professionals if unsure.
Startup Portal Business Service provides expert tax planning, return filing, and compliance support so you never miss a step.
Why Choose Startup Portal for ITR Filing in 2025?
Filing your income tax return correctly and on time is essential to avoid penalties and maximize your refunds. At Startup Portal Business Service, we simplify the entire process for you. Here’s why thousands trust us every year:
- Expert Guidance: Get support from experienced tax professionals who understand both old and new regimes.
- 100% Accuracy: We ensure error-free return filing with proper deductions, rebates, and documentation.
- Quick Turnaround: Fast processing so you never miss deadlines.
- Affordable Pricing: Transparent and cost-effective plans for salaried individuals, freelancers, and small businesses.
- All India Service: File your ITR from anywhere in India – completely online!
- Complete Confidentiality: Your financial data stays secure and private with us.
We support all essential registrations like GST Registration Service in Pune and Professional Tax Registration Services in Pune, so you get a complete business compliance package under one roof. Need help with ITR filing? Contact Startup Portal Business Service’s expert team today for fast, accurate, and affordable tax return services. Call or WhatsApp us at +91 8975400253 / +91 7249645760.
Conclusion: Plan Early, Save More
The income tax changes introduced in July 2025 mark a significant shift toward a simpler, more taxpayer-friendly system. With a clearer slab structure, increased standard deduction, and digital filing norms, managing taxes is easier than ever. Still, choosing the right tax regime and filing accurately needs planning. Don’t wait until the last minute. Start early, stay organised, and consult trusted experts. Let the team at Startup Portal Business Service guide you through a smooth and accurate tax filing process. Whether you’re an individual, a salaried employee, or a business owner, we’ve got you covered.