No changes in the income tax slabs for the upcoming financial year, 2024-25, have been announced in the interim budget 2024 by the finance minister Nirmala Sitharaman in her speech. Under the income tax laws, an individual (not having any business income) is required to choose between the new and old tax regimes every year. Hence, an individual can choose the new tax regime one year and the old tax regime the next. It is important to note that a large number of changes were made in Budget 2023 in the new tax regime. The income tax slab changes announced in Budget 2023 are effective for the financial year between April 1, 2023, and March 31, 2024, and are set to remain unchanged for FY 2024-25 (April 1, 2024 and March 31, 2025).
Current income tax slabs under new tax regime
Income tax slabs (In Rs) | Income tax rate (%) |
Up to 3,00,000 | 0 |
3,00,001-6,00,000 | 5% |
6,00,001-9,00,000 | 10% |
9,00,001-12,00,000 | 15% |
12,00,001-15,00,000 | 20% |
Above 15,00,001 | 30% |
Here are the income tax slabs for FY 2023-24 (AY 2024-25) in the new tax regime that will also be applicable for FY 2024-25 as per the interim Budget 2024 proposals: Cess will be levied at 4% on income tax amount. Surcharges will be levied on incomes above Rs 50 lakh.
What the salaried get in the new tax regime
The Budget 2023 had made some changes in the new tax regime for salaried individuals. If a salaried individual opts for the new tax regime in FY 2023-24 and/or FY 2024-25, they should be aware of the following tax benefits:
a) Income tax slabs revised from six to five
b) Basic exemption limit hiked to Rs 3 lakh from Rs 2.5 lakh - Rs 50,000 more in new tax regime
c) Zero tax payable for incomes not exceeding Rs 7 lakh due to rebate being hiked under Section 87A
d) Standard deduction introduced for salaried, pensioners and family pensioners
e) New tax regime becomes default tax regime
f) Surcharge on incomes above Rs 5 crore reduced to 25% from 37%
g) Marginal tax relief for small taxpayers whose incomes exceed Rs 7 lakh
Income tax slabs under the old tax regime
Budget 2023 had made no changes in the income tax slabs under the old tax regime. In the old tax regime, the income tax slabs applicable to individual taxpayers depend on their age in the relevant financial year. In the old tax regime, the basic exemption limit for individuals below 60 years is Rs 2.5 lakh. For senior citizens (above 60 years but below 80 years) and super senior citizens (80 years of age and above), the basic tax exemption limit is Rs 3 lakh and Rs 5 lakh, respectively. Here are the income tax slabs for FY 2023-24 (AY 2024-25) in the old tax regime for individuals below 60 years of age, senior citizens and super senior citizens.
Current income tax slabs for individuals below 60 years
Income tax slabs (In Rs) | Income tax rate (%) |
Up to 2,50,000 | 0 |
2,50,001 - 5,00,000 | 5% |
5,00,001-10,00,000 | 20% |
Above 10,00,001 | 30% |
Current income tax slabs for senior citizens
Income tax slabs (In Rs) | Income tax rate (%) |
Up to 3,00,000 | 0 |
3,00,001 - 5,00,000 | 5% |
5,00,001-10,00,000 | 20% |
Above 10,00,001 | 30% |
Current income tax slabs for super senior citizens
Income tax slabs (In Rs) | Income tax rate (%) |
Up to 5,00,000 | 0 |
5,00,001-10,00,000 | 20% |
Above 10,00,001 | 30% |
Cess will be levied at 4% on the income tax amount. Surcharges will be levied on incomes above Rs 50 lakh.
What the salaried get in the old tax regime
Unlike the new tax regime, an individual can avail of various tax exemptions and deductions under the old tax regime. These are Section 80C, 80D, Section 80TTA, HRA tax exemption and LTA tax exemption, among others. Do note that tax rebate under Section 87A is available under the old tax regime for taxable incomes up to Rs 5 lakh.
-Economic Times 01st Feb, 2024.
Comments
Post a Comment