(Source: Livemint)
The Union Budget was presented in the Parliament on February 1 by Finance Minister Nirmala Sitharaman, with a number of proposals regarding income tax relief for citizens.
A new tax regime was put forward, under which income tax slab rates for individuals have remained constant. However, “individuals foregoing exemptions and deductions would be taxed at reduced tax rates,” Economic Times reports.
It continues, “The exemptions and deductions that would need to be foregone includes inter alia exemptions and deductions claimed widely by individuals including House Rent Allowance (HRA), Leave Travel Concession (LTA), standard deduction, deductions under Section 80C, deduction in relation to self-occupied house property, set-off of loss from house property against any other source of income, etc.”
|
Total Income in Rs. |
Optional Tax Rate |
|
< 2.5 lakh |
Nil |
|
2,50,001 – 5,00,000 |
5% |
|
5,00,001 – 7,50,000 |
10% |
|
7,50,001 – 10,00,000 |
15% |
|
10,00,001 – 12,50,000 |
20% |
|
12,50,001 – 15,00,000 |
25% |
|
> 15,00,000 |
30% |
Income Tax Slab Rates applicable under the new tax regime
(Source: Economic Times)
It is worth noting that the new tax regime, however, is optional, and individuals can opt per choice to claim the available exemptions/deductions. The choice between the existing and new tax regimes will depend on the benefits to be redeemed by each individual in the form of lower payable tax, dependent on their income and investment composition. Moneycontrol innovated an income tax calculator, through which people could come to know their tax liability per new income tax slabs.
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