First-Time Filing Taxes Tips:  Today, India is celebrating its 167th Income Tax Day 2026. The day honours and celebrates the tax that ensures the stability and development of the nation. Income tax is not just a revenue that the government take from its citizens for the welfare of its citizens, like defence, infrastructure, healthcare, education and overall development.

Additionally, income tax also serves as a significant economic tool to redistribute wealth and reduce societal inequalities.

5 Things Gen Z Must Know About Income Tax

From filing ITR for the first time to knowing basic aspects of income tax, here is a list of 5 things Gen Z must know about Income Tax.

1. Don’t Miss July 31 Deadline

Income Tax Return (ITR) is widely accepted as official proof of your annual income, which helps you claim TDS refunds, for loans and credit, and much more. It is also proof of the tax you need to pay on your income. Therefore, for FY 2025–26 (AY 2026-27), the ITR deadline for salaried individuals, pensioners, and those with interest or rental income is July 31, 2026. Freelancers filing ITR-3/ITR-4 (non-audit) now get until August 31, 2026, which is a big win for gig workers.

2. Up To Rs 12 Lakh Income Can Mean Zero Tax

Now, some old news: under the new tax regime for tax year 2026-27, resident individuals with income up to Rs 12 lakh get a full rebate under Section 87A. With the Rs 75,000 standard deduction, salaried earners effectively pay zero tax up to Rs 12.75 lakh.

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3. A Brand-New Tax Law

The Income Tax Act, 2025 comes into effect on April 1, 2026, replacing the 65-year-old Income Tax Act, 1961. It introduces a unified ‘Tax Year’ concept, replacing the confusing ‘previous year’/’assessment year’ split Gen Z will encounter while filing.

According to incometax.gov.in,  “The Income Tax Act, 2025 has been enacted to provide a streamlined, simplified, and modern tax code with reduced compliance burden, consolidated provisions, and clear definitions.”

4. New Regime Is Default But Old Regime Still Has Perks.

During the Budget 2023 speech, Union finance minister Nirmala Sitharaman announced a new tax regime which will be the default tax regime. The new regime excludes exemptions such as HRA and most 80C deductions, but Section 80C investment deductions up to Rs 1.5 lakh remain available only under the old regime. You can still switch regimes each year when filing, so you can compare before choosing.

5. Filing On Time Protects Your Future Benefits

One should always file their ITR on time to save yourself from penalties and interest charges. Beyond avoiding late fees, missing the July 31 deadline means filing a belated return with late fees and losing the option to switch to the old regime for that year, which is worth knowing before your first job's tax season.

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Each of the above pieces of information is necessary to know for Gen Z who are just starting in the work culture. So if you are a Gen Z and filing your ITR for the first time,  it is important to know that documents like Form 16 (from your current employer and former employer if you changed jobs mid-year), PAN Card, Aadhaar Card (PAN-Aadhaar must be linked), and investment proofs (including bank deposits, PPF deposits, etc.), home loan interest certificate, and insurance premium payment receipts are some of the important documents to keep handy.