Section 36 → Sections 29–32

Other deductions — insurance, bonus, interest, bad debts, employer contributions

Section 36 of the old Income-tax Act, 1961 · new sections 29–32 under the Income-tax Act, 2025

New reference Sections 29, 30, 31 and 32

Income-tax Act, 1961Section 36

One section with 20-odd clauses: insurance premium, bonus, interest (36(1)(iii)), bad debts (36(1)(vii)), provisions of banks (36(1)(viia))
36(1)(iv), (iva), (v), (va): employer and employee contributions to PF, NPS, gratuity
36(1)(ib): health insurance of employees by non-cash mode
36(1)(viii) special reserve; 36(1)(xv) STT etc.

Applies to FY 2025-26 (AY 2026-27) and earlier years.

Income-tax Act, 2025Sections 29, 30, 31 and 32

Section 29: employee welfare — PF, superannuation, NPS (up to 14% of salary), gratuity, employee contributions
Section 30: insurance premiums (stock, cattle, employee health by non-cash mode)
Section 31: bad debts and provision for bad and doubtful debts (banks, NBFCs)
Section 32: other deductions — bonus/commission, interest on borrowed capital, and the rest

Applies from tax year 2026-27 (from 1 April 2026).

What changed

Split by subject into four sections. One substantive change: Finance Act 2026 allows employees' PF/ESI contributions if deposited by the return due date (section 29(1)(e)).

Practice notes

Interest on capital borrowed for an asset is not deductible until the asset is first put to use — section 32(b)(i).
Read 36(1)(va) changes on its own page.

These are summaries, not the statutory text. Read the bare Act for both sections on the Income Tax Department's official site, which also has a side-by-side comparison utility.

Frequently asked

Where is section 36(1)(iii) interest deduction in the new Income Tax Act?

Section 32(b) of the Income-tax Act, 2025.

Where is bad debt deduction 36(1)(vii) in the new Act?

Section 31 of the Income-tax Act, 2025 deals with bad debts and provisions for bad and doubtful debts.

What changed in section 36 under the new Income Tax Act?

Split by subject into four sections. One substantive change: Finance Act 2026 allows employees' PF/ESI contributions if deposited by the return due date (section 29(1)(e)).

Is section 36 still applicable for FY 2025-26?

Yes. Income of FY 2025-26 (AY 2026-27) and earlier years is governed by section 36 of the 1961 Act. Sections 29–32 of the 2025 Act applies from tax year 2026-27.

Related sections

36(1)(va)→29(1)(e)Employees' PF/ESI contribution deducted from salary — deduction for the employer 37(1)→34General deduction for business expenditure; disallowance of illegal expenses and CSR 43B→37Deductions allowed only on actual payment (taxes, PF, bonus, leave encashment, MSME dues)40→35Amounts not deductible: TDS defaults (40(a)) and partner remuneration/interest (40(b))