From 1 January 2026: Major Changes in Salaries, Taxes, LPG, Digital Payments, and Vehicle Prices

New Delhi: As the new year approaches, 2026 brings several important changes affecting your wallet directly. These include updates in banking, savings schemes, taxes, LPG prices, the 8th Pay Commission, and vehicle rates. Here’s a detailed look at what’s coming into effect from 1 January 2026.

Small Savings Schemes
The government reviews interest rates on small savings schemes such as PPF, Sukanya Samriddhi, and NSC every quarter. Following a 0.25% cut in the RBI repo rate, bond yields have dropped, raising the possibility of a reduction in interest rates on small savings schemes starting the new quarter. The previous quarter saw no change in rates.

ITR Penalty Rules
The last date to file revised and belated Income Tax Returns (ITR) for FY 2024-25 is 31 December 2025. Missing this deadline may delay your tax refund. Post this date, taxpayers will have to file an updated return with heavy penalties. Returns can be filed up to 48 months after the end of the assessment year, but old losses cannot be claimed, and penalty tax applies.

PAN-Aadhaar Linking
The deadline for linking PAN with Aadhaar ends on 31 December, but this applies only to PAN holders who used an Aadhaar Enrolment ID instead of the Aadhaar number to apply for their PAN. Non-compliance may invalidate your PAN, affecting tax filing, TDS deductions, investments, KYC, and even fixed deposit applications.

Stricter Digital Payment Norms
From 1 January 2026, digital payment rules will tighten. Platforms like Google Pay, PhonePe, and WhatsApp Pay will enforce stricter KYC processes, including mobile number verification and additional safety layers, to curb fraudulent accounts amid rising digital fraud and banking scams.

LPG Price Review
The government has announced a 2-3 INR per unit reduction in CNG and PNG prices effective 1 January 2026. This may extend to domestic LPG cylinders as well. Although commercial LPG rates have already been reduced, 14.2-kg domestic cylinders have seen no price change this year. Crude oil prices recently fell to around $62 per barrel, the lowest since 2021.

8th Pay Commission
The 8th Central Pay Commission has been formally announced. While recommendations may take time, they will be effective from 1 January 2026, potentially giving employees and pensioners substantial arrears payments.

Vehicle Price Hikes
Several automobile companies, including Nissan, BMW, JSW MG Motor, Renault, and Ather Energy, have announced price increases from ₹3,000 up to 3% from 1 January 2026. Tata Motors and Honda have also indicated potential hikes. Companies cite rising raw material costs as the reason for increased prices.