7 major rules changing from April 1, 2025: Know how these rules will impact your pocket

Citizens across will be impacted by some financial and regulatory developments that take effect on April 1, 2025. Here's a detailed summary of all the changes you can anticipate, including the introduction of the Unified Pension Scheme, modifications to the tax slabs, and the Unified Payments Interface (UPI).

UPI

Starting on April 1, 2025, the National Payments Corporation of India (NPCI) is all set to implement new rules for transactions based on Unified Payments Interface (UPI) numbers. To reduce transaction processing errors, this legislative reform mandates that banks and Payment Service Provider (PSP) apps update mobile number records every week. 

Banks, Payment Service Providers (PSPs), and third-party UPI service providers, such as PhonePe, GPay, and Paytm, are required by the most recent rules to follow certain guidelines regarding numeric UPI IDs.

The requirement that UPI users specifically accept to the seeding of their UPI numbers is a key component of these standards, which strengthens the transparency and lucidity of consent procedures.  Notably, user preferences and data integrity are maintained because consent cannot be sought before or during transaction procedures.

Unified Pension Scheme

The central government introduced the Unified Pension Scheme (UPS) in August 2024, although it will take into effect on April 1, 2025. An estimated 23 lakh central government workers are expected to gain from it. To guarantee financial stability after retirement, those who have served for at least 25 years will receive a pension equal to 50% of their average basic pay for the previous 12 months.

GST

The GST regime is also undergoing its yearly overhaul with the start of the new fiscal year.  For increased security on the GST system, taxpayers would be required to use multi-factor authentication (MFA).  Additionally, E-Way Bills (EWBs) can only be generated for base documents not older than 180 days.

You can no longer file out of order or skip months if you file GSTR-7 for tax deductions at source (TDS).  Additionally, to undergo biometric authentication, promoters and directors must now go to a GST Suvidha Kendra.

New tax slabs and rates

The updated tax structure will go into effect on Tuesday, April 1, following the announcement of the new tax slabs and rates by Union Finance Minister Nirmala Sitharaman in the parliament's annual budget statement.  Under the new system, people who make up to Rs 12 lakh a year will not be required to pay taxes.

A standard deduction of Rs 75,000 will also be available to salaried individuals, meaning that an individual with a salary up to Rs 12,75,000 is exempt from paying any taxes.

0 to Rs 4 lakh – NIL

Rs 4 lakh to Rs 8 lakh – 5%

Rs 8,00,001 to Rs 12,00,000 – 10%

Rs 12,00,001 to Rs 16,00,000 – 15%

Rs 16,00,001 to Rs 20,00,000 – 20%

Rs 20,00,001 to Rs 24,00,000 – 25%

Above Rs 24,00,000 – 30%

(Note: No changes announced in the Old Tax Regime)

TDS

TDS limits have been raised in numerous parts as of April 1, 2025, which will help small taxpayers. For older folks, the TDS cap on interest income will rise to Rs 1 lakh.

Time limit for updated tax return (ITR-U) increased

The 12 months for filing an amended ITR has now been extended to 48 months (4 years). It can now be updated for four years if the return is missed for whatever reason.

New limit on salary paid to partner

For partnership firms, the maximum deduction limit on partner salaries has been set.