India is set to undergo major financial changes from April 1, 2025, impacting income tax, UPI rules, credit card rewards, fixed deposits, and more. From new income tax rules to stricter norms for UPI payments and mutual fund accounts, staying updated is crucial to avoid penalties and make informed financial decisions.

In this article, we break down the 16 most important financial and taxation changes effective from April 1, 2025, helping you understand how each update might affect your daily life, savings, and investments.

1. New Income Tax Slabs and ₹75,000 Standard Deduction for Salaried Employees

From April 1, 2025, individuals earning up to ₹12 lakh per annum will not have to pay income tax under the new income tax regime. A new standard deduction of ₹75,000 has been introduced for salaried employees, effectively raising the tax-free income threshold to ₹12.75 lakh.

2. UPI Payments Blocked for Inactive Mobile Numbers

From April 1, UPI payments will not be allowed from mobile numbers that have been inactive for an extended period. This move is aimed at reducing fraud and securing digital transactions.

What to Do:

Make sure your UPI-linked number is active and updated with your bank. Regularly use UPI to avoid deactivation transfers.

3. SBI and Axis Credit Card Rewards Are Changing

Due to the Vistara-Air India merger, reward structures for these cards are being modified:

• SBI SimplyCLICK

• Air India SBI Platinum

• Axis Vistara Credit Card

Check your issuer’s updated terms and consider switching cards if the new structure no longer aligns with your spending.

4. Unified Pension Scheme (UPS) to Replace Old System

The new Unified Pension Scheme (UPS) will come into effect for 23 lakh central government employees.

Key Benefits:

• Pension = 50% of the average basic salary (past 12 months)

• Applicable for those with 25+ years of service

This change standardizes retirement benefits and increases transparency.

6. Minimum Balance Penalties by SBI, PNB, and Canara Bank

These banks are revising minimum balance requirements for savings accounts. Customers failing to comply will face monthly penalties.

Action Step: Log into your bank’s app or website to check your updated minimum balance requirement.

7. New FD Interest Rates by Major Banks

Banks like SBI, HDFC Bank, and IDBI have announced changes to their FD and savings interest rates. Many are also offering special FDs for senior citizens.

8. PAN-Aadhaar Link Now Mandatory for Dividends

If your PAN and Aadhaar are not linked, you will:

• Not receive dividends on shares or mutual funds

• Be subject to higher TDS on capital gains

• Miss tax credit entries in Form 26AS

🛠️ Connect with team Enrichwise to link your Pan and Aadhaar.

9. SEBI Makes KYC Mandatory for All Demat & Mutual Fund Accounts

Investors must update KYC and nominee details by April 1, or face account freezing.

Reactivation is possible by submitting the updated documents through your broker or mutual fund platform.

10. Higher TDS-Free Limit for FD Interest Earnings

Starting FY 2025–26:

• Senior citizens: No TDS up to ₹1 lakh in FD interest (previously ₹50,000)

• Others: TDS-free limit raised to ₹50,000 (from ₹40,000)

This provides more tax-free passive income for fixed-income investors.

11. LPG Gas Cylinder Prices Will Be Revised

Oil companies will revise LPG cylinder prices based on:

• Global crude oil rates

• USD-INR exchange rate

💡 Keep an eye on LPG price notifications via your distributor’s app or official portals.

12. Revised TDS and TCS Thresholds to Reduce Compliance Burden

To support small businesses and low-value transactions, TDS and TCS will now apply only to high-value deals, simplifying compliance.

• Businesses should update their accounting software to reflect new limits.

13. TDS of 10% on Partner Remuneration Under Section 194T

Firms and LLPs must deduct 10% TDS on payments to partners exceeding ₹20,000 annually. This includes:

• Salary

• Commission

• Interest

• Bonuses

📌 Ensure accurate entries in your firm’s books to avoid audit issues.

14. TCS on Sale of Goods Over ₹50 Lakhs Removed

Section 206C(1H), which required TCS collection on sales exceeding ₹50 lakh, has been removed. This eliminates confusion with Section 194Q and reduces dual compliance.

15. Sections 206AB & 206CCA Scrapped

These sections, which mandated higher TDS/TCS for ITR non-filers, have been eliminated. Businesses no longer need to verify ITR compliance before making payments.

This is a huge win for small businesses and accounting teams.

16. Financial Checklist Before April 1, 2025

Here’s what you should do now to avoid penalties and maximize savings:

• Link PAN with Aadhaar immediately

• Update UPI-linked mobile number

• Review credit card benefits and switch if needed

• Complete KYC and nominee details for demat and MF accounts

• Reinvest FDs to benefit from new TDS limits

• Maintain minimum balance in all bank accounts

• Track LPG prices for monthly budgeting

Plan Ahead and Maximize Your 2025 Finances

With these 16 major financial changes taking effect from April 1, 2025, now is the time to take stock of your finances and ensure you’re fully compliant. Many of these updates offer real benefits, from tax exemptions to better FD earnings—but only if you act early.

📌 Bookmark this guide and share it with colleagues, friends, or clients to help them stay informed.

💬 Got questions about how these changes affect you? Leave a comment or reach out—we’re here to help.