2024-07-24 03:56:13
New Delhi: Union Finance Minister Nirmala Sitharaman has given relief in income tax to taxpayers in the budget for the financial year 2024-25. However, this relief will be available only to those who choose the new tax system. Now the new tax system has been revised. Finance Minister Nirmala Sitharaman has presented proposals to change the income tax slabs and rates. Now the standard deduction has been increased from Rs 50 thousand to Rs 75 thousand. The basic exemption limit is only Rs 3 lakh.
How much can a salaried save
The Finance Minister said that the changes made in the income tax will enable the salaried class to save up to Rs 17,500.
Rates and slabs for the financial year 2024-25 under the new income tax system
Total Income (in Rupees)Income Tax RateUp to 0-3 lakhsZeroUp to 3-7 lakhs5%Up to 7-10 lakhs10%Up to 10-12 lakhs15%Up to 12-15 lakhs20%More than 15 lakhs30%How will you benefit?
We spoke to income tax expert CA Kamlesh Kumar about how the new provision will benefit. He admitted that Ghanshyam’s annual salary is Rs 10 lakh. He has opted for the new tax regime. Last year he had to pay Rs 54,600 on the same income by applying income tax and cess. Now he will have to pay only Rs 44,200 by adding income tax and cess.
Understand it like this
Ghanshyam’s income is 10 lakhs. Last year he got a standard deduction of 50 thousand rupees. Now his income is 9.5 lakhs. Out of this, there will be no tax on 3 lakh rupees. Above this, up to 6 lakh rupees, there will be a tax of 5%, which means a tax of 15,000 rupees. Last year, there was a tax of 10% on the slab of 6 to 9 lakh rupees. This means a tax of 30,000 rupees on this amount. After this, the remaining 50 thousand rupees were taxed at the rate of 15%. In this way, a total tax of 52,500 rupees was made. A cess of 4% will be levied on this. Now 2100 rupees more will be added to this. This means a total tax of 54,600 rupees.
How much tax will be levied now
Ghanshyam’s income is still Rs 10 lakh. But this year he will get a standard deduction of Rs 75 thousand. This means that his income is left with Rs 9.25 lakh. Out of this, there is zero tax on Rs 3 lakh. Five percent tax on three to seven lakh rupees. This means that he will have to pay a tax of Rs 20 thousand on this amount. After this, Rs 2.25 lakh remains. This will be taxed at the rate of 10 percent. This means that he will have to pay Rs 22,500 more. The total tax becomes Rs 42,500. A cess of four percent will be levied on this. This means that Rs 1700 will have to be paid in this head. In this way, the total tax becomes Rs 44,200. This year Ghanshyam will save Rs 10,400 as compared to last year.