Section 87A → Section 155
Rebate of income-tax in case of certain individuals
Quick Answer
Section 87A of the Income Tax Act, 1961 (Rebate of income-tax in case of certain individuals) corresponds to Section 155 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 87A
Provision Summary
Provides a tax rebate effectively making income up to a certain limit (e.g., Rs. 5 Lakhs or Rs. 7 Lakhs under new regime) entirely tax-free.
Sec 155
Provision Summary
Retained as the primary mechanism for the zero-tax threshold in the simplified tax regime.
Key Changes & Highlights
- Rebate algorithms are hardcoded into the portal to ensure it does not accidentally offset special rate taxes like Crypto gains.
Related Articles from the Tax Academy
general transition
Complete Guide to the New Income Tax Act 2025: Section Changes
A professional compliance guide on the transition from the Income Tax Act 1961 to the new Direct Tax Code 2025, effective April 1, 2026. Understand section changes and prepare for the 2025 income tax sunset.
old vs new scheme
Old vs New Tax Regime AY 2026-27: Which Saves More Tax?
A complete professional guide for FY 2025-26 comparing the Old and New Tax Regimes. Analyze tax slabs, deductions, and your break-even point to optimize your tax liability.
old vs new scheme
Senior Citizens Tax Slabs 2025: Old Scheme vs New Default Regime
A professional guide for senior citizens on choosing between the Old Tax Scheme and the New Default Regime for FY 2025-26. Compare slabs, deductions, and calculate your tax liability.
old vs new scheme
HUF Tax Slabs 2026: Old vs New Regime Comparison Guide
A professional guide for HUFs on choosing between the Old and New Tax Regimes for AY 2026-27. Understand new slab rates, disallowed deductions, and break-even analysis.
old vs new scheme
Old vs New Tax Regime 2025: A Detailed Section-by-Section Comparison
A professional guide comparing the old Income Tax Act, 1961, and the new default tax regime for 2025. Understand slab rates, deductions, and your break-even point.
old vs new scheme
Old vs New Tax Regime 2025: Ultimate Guide to Choosing
A professional CA's detailed guide on the Old vs. New (Default) Tax Regime for FY 2025-26. Compare slabs, deductions, and find your break-even point to optimize your tax.
Frequently Asked Questions
What does Section 87A of the Income Tax Act 1961 deal with?
Section 87A (Rebate of income-tax in case of certain individuals) Provides a tax rebate effectively making income up to a certain limit (e.g., Rs. 5 Lakhs or Rs. 7 Lakhs under new regime) entirely tax-free.
What is the new section number for Section 87A under the Direct Tax Code 2025?
Section 87A of the ITA 1961 maps to Section 155 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 87A under the new tax code?
Section 87A is marked as "Retained" with status "Modified". Impact: Critical - This section alone defines whether middle-class taxpayers pay tax or not.
What are the key changes to Section 87A under DTC 2025?
Rebate algorithms are hardcoded into the portal to ensure it does not accidentally offset special rate taxes like Crypto gains.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
Need professional help on Section 87A?
Compare trusted providers — both offer DTC 2025-ready CA services.
*Affiliate links — we may earn a small commission at no extra cost to you. Disclosure.
Want to calculate tax on this section?