Key Highlights from Budget 2026

The finance minister presented the Union Budget 2026 today. While this year’s budget did not tinker with the tax slabs under the old or the new tax regime, it did have a bit of good and bad news depending on your investments and expenses.

Let’s look at some of the key announcements in Budget 2026.

#1 No change in tax slabs

There is no change to the tax slabs in either the old regime or the new tax regime.

#2 TCS reduced for LRS remittance for medical and education purposes

Good news if a family member is travelling abroad for higher education or for any medical treatment. More relief if you are planning to travel abroad by booking a travel package.

Tax collection at source (TCS) for remittance under Liberalized remittance scheme (LRS) medical and education purposes has been reduced from 5% to 2%.

TCS rate on the sale of overseas tour program package was 5% up to Rs 10 lacs and 20% for the excess over Rs 10 lacs. The budget proposes reducing the TCS to 2% irrespective of the amount.

Note that TCS is not tax. The amount you spend on education/medical treatment/foreign travel is not taxable. TCS is just for tracking purposes. At the end of the year, if more tax has been deposited (including TCS) against your PAN than your income would demand, you can claim the excess tax as refund.

#3 STT of options and futures hiked

STT (Securities transaction tax) of futures increased from 0.02% to 0.05%.

STT on options premium increased from 0.1% to 0.15%.

STT on sale and purchase of securities/other instruments remains unchanged.

Unless you trade derivatives, this STT hike does not affect you directly.

However, this will affect you indirectly if you invest in arbitrage funds as such funds trade futures. You can expect pre-tax returns of arbitrage funds to fall slightly.

#4 Taxation of Sovereign Gold Bonds changed

This is a major hit for investors in Sovereign gold bonds.

Any gains from the “redemption” of Sovereign gold bonds were exempt from tax. Now, redemption with RBI could happen in 2 ways.

1. At the time of bond maturity (8 years). OR
2. During pre-mature redemption windows. Pre-mature redemption window was available to investors from the end of the 5th year (since the bond issuance) at six-month intervals.

This was irrespective of how you purchased the bond. At the time of primary issuance (when the RBI first issued the gold bond). Or in the secondary market.

Now, the rule has been modified.

Going forward, the capital gains will be exempt from tax only if:

1. You bought the gold bond at the time of primary issuance. AND
2. Held the bond for 8 years (until maturity). Redeeming with the RBI during premature withdrawal window won’t help.

Both the conditions must be met for gains to be exempt from tax.

Capital gains will be taxable if

1. You bought the gold bonds in the secondary market. This is irrespective of whether you sell in the secondary market or redeem during premature withdrawal window or hold until maturity.
2. You sold the gold bonds in the secondary market, irrespective of whether you bought during primary issuance or from the secondary market.
3. You bought during primary issuance and redeemed during the premature withdrawal window.

#5 Relaxation of requirement of TAN

If you are buying an immoveable property from an NRI, you are required to get a TAN (Tax deduction and collection account number) to deduct and deposit requisite TDS. This is an unnecessary hassle,especially if you are just a one-time buyer. 

Now, the requirement of TAN has been done away with. Hence, if you are buying property from an NRI, you do not need to apply for TAN. Your PAN is sufficient for the purpose.

For resident sellers, the TDS of 1% is applicable if the transaction value exceeds Rs 50 lacs. However, in case the seller is NRI, there is no exemption on TDS deduction for transaction value up to Rs 50 lacs..The TDS could be 12.5% or 30% depending on the holding period, irrespective of the transaction value. 

Clearly, this is a relief if you are buying property from an NRI.

#6 Timeline for revising Income Tax Returns extended

The deadline for revising Income Tax returns (ITR) has been extended from December 31 to March 31. So, you have more time to rectify an error in your ITR.