New Tax Regime: Finance Minister Nirmala Sitharaman gave relief to middle class taxpayers in her 8th budget. She has changed the tax slabs under the new tax regime, due to which many people are finding it difficult to understand how much they will benefit. Let us know what are the new tax slabs and what will be right for you
New Tax Regime: Finance Minister Nirmala Sitharaman gave relief to middle class taxpayers in her 8th budget. She has changed the tax slabs under the new tax regime, due to which many people are finding it difficult to understand how much they will benefit. Let us know what are the new tax slabs and what will be right for you.
What are the new tax slabs?
According to the new tax regime in Budget 2025, now there will be no tax on income up to Rs 4 lakh.
5% tax on income of Rs 4 to 8 lakh
10% tax on Rs 8 to 12 lakh
15% on Rs 12 to 16 lakh
20% on Rs 16 to 20 lakh
25% on Rs 20 to 24 lakh
30% tax will be levied on income above Rs 24 lakh.
The zero tax limit has been increased from Rs 3 lakh to Rs 4 lakh as compared to earlier. The income limit of every tax bracket has also been increased now so that more people can benefit.
How will you get tax exemption on income up to Rs 12 lakh?
The government has decided to give tax exemption to those earning up to Rs 12 lakh. Salaried people will also get a standard deduction of Rs 75,000, which will reduce the total taxable income. For example, an income of Rs 12 lakh will get a tax exemption of up to Rs 80,000.
How will tax be levied if your salary is Rs 16 lakh?
Up to 4 lakh – no tax
5% on 4-8 lakh = Rs 20,000
10% on 8-12 lakh = Rs 40,000
15% on 12-16 lakh = Rs 60,000
Total tax = Rs 1,20,000
This will be about Rs 50,000 less than the current tax.
How much tax if your salary is Rs 50 lakh?
Under the new regime, now Rs 10.8 lakh tax will have to be paid on an income of Rs 50 lakh. This is Rs 1.1 lakh less than the old tax system.
Old tax regime or new – what to choose?
If you can claim more exemptions (like HRA, 80C, home loan etc.) in the old tax system, then it can be beneficial for you. For example, if you claim an exemption of Rs 4 lakh on an income of Rs 16 lakh, then you will have to pay a tax of Rs 1,77,500 in the old regime, whereas in the new regime you will have to pay a tax of only Rs 1,20,000. In such a situation, the new tax regime can prove to be better for you.
The post Tax Slab Changes: Finance Minister changed the tax slab under the new tax regime, know how much benefit the middle class taxpayers will get first appeared on informalnewz.
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