Budget 2024: Standard deduction limit in new tax regime raised to Rs 75,000
New Delhi, July 23, 2024
Union Budget 2024: Nirmala Sitharaman on Tuesday announced that the standard deduction limit under the new tax regime has been revised to Rs 75,000 from the existing Rs 50,000
Union Budget 2024: In a relief for taxpayers under the new tax regime, Finance Minister Nirmala Sithraman on Tuesday announced that the standard deduction threshold limit has now been increased to Rs 75,000.
The threshold limit of the standard deduction for salaried individuals was earlier pegged at Rs 50,000. Ahead of the Budget, there were speculations that the standard dedication limit in the direct tax system may be revised to Rs 1 lakh.
What is standard deduction in income tax?
Under the Indian taxation laws, standard deduction is a provision for salaried employees and taxpayers receiving a pension. The provision allows eligible individuals to claim a deduction of the decided limit from their taxable income without the need to submit any disclosures or investment proofs.
What are the revised tax slab rates under the new tax regime?
Sitharaman also announced a revision to the tax slab rates under the new taxation regime. According to the revised slabs, for incomes ranging from Rs 0 to 3 lakh, no tax is applicable. Income between Rs 3 lakh and Rs 7 lakh is taxed at 5 percent, while incomes between Rs 7 lakh and Rs 10 lakh are taxed at 10 percent. Incomes ranging from Rs 10 lakh to Rs 12 lakh incur a tax rate of 15 percent, and for incomes between Rs 12 lakh and Rs 15 lakh, the tax rate is 20 percent. Any income exceeding Rs 15 lakh falls under the highest tax bracket of 30 percent.
Check the table for the revised slab rates under the new tax regime:
Rs 0-3 lakh - Nil
Rs 3-7 lakh - 5 per cent
Rs 7-10 lakh - 10 per cent
Rs 10-12 lakh 15 per cent
Rs 12-15 lakh 20 per cent
Rs 15 lakh and above - 30 per cent
The standard deduction provision in taxes applies to taxpayers under both the old and new taxation regimes when they file their income tax returns.
[The Business Standard]
