The Institute of Chartered Accountants of India (ICAI) has released an important announcement dated 5 December 2025 regarding the applicability of the Income-tax Act, 2025 in CA examinations. This update is highly relevant for CA Intermediate and CA Final students preparing for 2026 and 2027 attempts.

This article provides a clear, simplified explanation of the notification and how it applies under the new three-attempt exam cycle (January, May/June, September).

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📌 Summary of the ICAI Notification

As per the official notification issued by ICAI (BOS-A) 89799bos-announcement-income-ta…:

• The Income-tax Act, 2025 received Presidential assent on 21 August 2025.
• The Act becomes effective from 1 April 2026.
• It applies for the tax year 2026–27.
• Since this tax year ends on 31 March 2027, ICAI will examine the new law only in exams conducted after that date.

🔔 Therefore, the new Income-tax Act, 2025 will be applicable from the May/June 2027 attempt onwards.

This is the official and final applicability.

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📚 Applicability Under the New 3-Exam Pattern

ICAI now conducts CA exams three times a year. With this structure, the applicability of the Income-tax Act, 2025 becomes:

Attempt	Law Applicable
January 2026	Income-tax Act, 1961
May/June 2026	Income-tax Act, 1961
September 2026	Income-tax Act, 1961
January 2027	Income-tax Act, 1961
May/June 2027	Income-tax Act, 2025 (NEW)
September 2027	Income-tax Act, 2025
January 2028	Income-tax Act, 2025

✔ First exam with new Income-tax Act, 2025: May/June 2027

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📘 Papers Where the New Act Will Apply

According to the notification 89799bos-announcement-income-ta…, the following papers will now be based on the Income-tax Act, 2025 from May 2027 onwards:

CA Intermediate

• Paper 3A – Income-tax Law

CA Final

• Paper 4 – Direct Tax Laws & International Taxation

Self-Paced Online Modules

• Set C – Paper 5: International Taxation
  (Applicable from 1 May 2027 exam session onward)

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📅 Why May/June 2027 Is the First Applicable Attempt

The logic is straightforward:

• New Act effective: 1 April 2026
• Applicable to tax year: 2026–27
• Tax year ends: 31 March 2027
• ICAI examines last completed tax year
• Next exam after 31 March 2027 = May/June 2027 attempt

Thus, May/June 2027 is the first logical and official attempt.

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🎯 What This Means for Students

If you are preparing for exams in 2026 (Jan, May/June, Sept):

✔ Continue studying Income-tax Act, 1961
✔ No syllabus change for Direct Tax or International Taxation

If you are preparing for 2027 exams:

✔ Expect transition to Income-tax Act, 2025
✔ ICAI will release updated:

• Study Material
• Case Laws & MCQs
• RTPs/MTPs
• Practice Questions

✔ Begin familiarising yourself with the new structure once ICAI uploads study material.

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📝 Conclusion

The new Income-tax Act, 2025 marks a major shift in India’s direct tax framework. ICAI has ensured a smooth and student-friendly transition by applying the law only from May/June 2027 onwards, giving students sufficient time to prepare.

In short:

👉 All exams till January 2027 follow the Income-tax Act, 1961

👉 All exams from May/June 2027 onwards follow the Income-tax Act, 2025

This clarity helps CA aspirants plan their preparation confidently and avoid confusion caused by unofficial sources.