Section 156 - Rebate of income-tax in case of certain individuals
A resident individual has two routes. Under the regular regime, total income up to ₹5 lakh gets the lower of the tax payable or ₹12,500. Under section 202(1), total income up to ₹12 lakh gets the lower of tax payable or ₹60,000. If total income is slightly above ₹12 lakh, marginal relief limits tax to the excess income over ₹12 lakh, where the statutory formula applies.
Reviewed by CA Nikhil Gupta · Updated 9 October 2026
Current law and effective date
Section 156 is controlled against the consolidated Income-tax Act, 2025 as amended by the Finance Act, 2026. The Act and Income-tax Rules, 2026 operate from 1 April 2026; earlier years and saved proceedings require the repeal-and-savings framework rather than automatic migration.
Primary statute: Income Tax Department consolidated Act | Rules: Notified Income-tax Rules, 2026
2-minute decode
A resident individual has two routes. Under the regular regime, total income up to ₹5 lakh gets the lower of the tax payable or ₹12,500. Under section 202(1), total income up to ₹12 lakh gets the lower of tax payable or ₹60,000. If total income is slightly above ₹12 lakh, marginal relief limits tax to the excess income over ₹12 lakh, where the statutory formula applies.
Who should use this section
Resident individuals testing the ordinary rebate, the section 202 regime rebate and, where relevant, the statutory marginal-relief formula.
Old-law bridge
Section 87A
The old-law bridge is navigational, not automatic precedent transfer. Match the 1961 Act wording, saved proceedings, current 2025 Act text and effective date before importing an older interpretation.
Finance Act 2026 / current-law note
No section-specific Finance Act, 2026 textual substitution is separately flagged for section 156; the consolidated post-Finance-Act-2026 text remains the controlling version and must be used instead of pre-1 April 2026 extracts.
Professional alert
Eligibility is limited to a resident individual. Section 156(3) caps the section 202 rebate to tax payable at section 202(1) rates; tax on specially rated income requires separate analysis.
Connected Income-tax Rules, 2026 and Forms
| Rule | Current control | Form |
|---|---|---|
| No provision-specific Rule/Form is directly prescribed for this section in the mapping used here. Apply the statute directly and check the current Rules where another provision cross-refers to them. | ||
Worked application
Under section 202 rates, total income of ₹12.10 lakh produces slab tax of ₹61,500 before cess. Excess income over ₹12 lakh is ₹10,000. Marginal rebate is ₹51,500, leaving tax of ₹10,000 before cess.
Evidence / compliance checklist
- Preserve the primary agreement, certificate, account statement or transaction record that establishes the facts relevant to section 156 (Rebate of income-tax in case of certain individuals).
- Reconcile the section 156 amount to books, return schedules and third-party evidence so the computation can be reproduced without relying on a narrative assertion.
- Keep the current-law source and any prescribed Rule/Form evidence with the tax-year file for section 156; do not rely on a legacy 1961 Act form merely because the section has an old-law bridge.
- Where section 156 contains a threshold, election or time limit, retain dated evidence proving that the condition was satisfied before the return or proceeding was finalised.
Common mistake
A common section 156 error is to apply the old-law label or headline rate without rebuilding the current statutory conditions. For “Rebate of income-tax in case of certain individuals”, the safer control is to test the exact taxpayer/transaction facts, the operative tax year, every linked Rule/Form and the Finance Act 2026 consolidated wording. Eligibility is limited to a resident individual. Section 156(3) caps the section 202 rebate to tax payable at section 202(1) rates; tax on specially rated income requires separate analysis.
Recommended approach
For section 156, start with the legal trigger in “Rebate of income-tax in case of certain individuals”, document the evidence for that trigger, then run the computation or procedural step against the current text. As a cross-check, verify this provision-specific checkpoint: Regular-regime resident individual: total income up to Rs 5,00,000; rebate limited to tax or Rs 12,500.
Thresholds, periods and timing checkpoints
- Regular-regime resident individual: total income up to Rs 5,00,000; rebate limited to tax or Rs 12,500.
- Section 202 regime: total income up to Rs 12,00,000; rebate limited to tax or Rs 60,000.
- Marginal relief applies in the statutory band above Rs 12,00,000 where the section formula is satisfied.
Related provisions and interaction map
Section 156 interacts with the other sections 155-160, section 202 where the rebate regime is relevant, Rules 73-76 where treaty/FTC procedure applies, and the return/assessment provisions.
Current statutory text
Primary-source trail
Statute: Income-tax Act, 2025 as amended by Finance Act, 2026
Rules: Income-tax Rules, 2026
Law navigation: Income Tax Department 2025 Act / Rules hub
Quoting note: Use the official consolidated Act for verbatim legislative language.
FAQs
Does an old Income-tax Act, 1961 case automatically decide section 156?
No. The old-law bridge helps research, but transferability depends on materially matching language, transition rules and any Finance Act 2026 change.
Which text should be quoted in advice or litigation?
Quote the consolidated official statute for the relevant tax year. If this page presents a provision summary rather than complete statutory text, use the official consolidated Act for verbatim legislative language.