Draft Income Tax Rule 136, 137, 138: Option for New Tax Regime and Special Tax Payment Provisions for Companies and Other Persons
Rules 136, 137 and 138 of the Draft Income-tax Rules, 2026 lay down procedural requirements for exercising the option for the new tax regime and for furnishing accountant reports in specified cases. Rule 136 provides that the option to exercise or withdraw the new tax regime under specified provisions of the Act must be made in the return of income furnished under section 263(1) for the relevant tax year. The rule applies to different categories of taxpayers as listed in the table, including manufacturing domestic companies under section 199(3), domestic companies under section 200(5), new manufacturing domestic companies under section 201(2), individuals, Hindu undivided families, associations of persons (other than co-operative societies), bodies of individuals, artificial juridical persons under section 202(4), resident co-operative societies under section 203(5), and new manufacturing co-operative societies under section 204(2). Rule 137 specifies that the accountant’s report required under section 206(1)(s) for certain companies must be furnished in Form No. 66. Similarly, Rule 138 mandates that the accountant’s report required under section 206(2)(j) for certain persons other than a company must be furnished in Form No. 67. These rules standardize the method of opting into or out of the new tax regime and formalize reporting requirements through prescribed forms.
Extract of Rule No. 136, 137, 138 of Draft Income-tax Rules, 2026
Rule 136
Exercise or withdrawal of option for new tax regime.
The option to be exercised or withdrawn under the provisions specified in column B of the table below, by a person specified in column C, for any tax year shall be in the return of income to be furnished under section 263(1) for such tax year.
TABLE
| Sl. No. | Provision of the Act | Person |
| A | B | C |
| 1. | 199(3) | Manufacturing domestic company |
| 2. | 200(5) | Domestic company |
| 3. | 201(2) | New manufacturing domestic company |
| 4. | 202(4) | Individual or Hindu undivided family, or an association of persons (other than a co-operative society) or a body of individuals, whether incorporated or not, or an artificial juridical person |
| 5. | 203(5) | Resident Co-operative Society |
| 6. | 204(2) | New manufacturing Co-operative Society |
Rule 137
Special provision for payment of tax by certain companies.
The report of an accountant which is required to be furnished by the assessee under section 206(1)(s) shall be in Form No. 66
Rule 138
Special provisions for payment of tax by certain persons other than a company.
The report of an accountant which is required to be furnished by the assessee under section 206(2)(j), shall be in Form No. 67.
