Big Tax Relief for Middle Class
The government has announced major tax reforms under the new tax regime, offering substantial benefits to salaried individuals and small business owners. Here’s what you need to know:
Higher Tax-Free Income
No tax on income up to Rs.12 lakh (earlier Rs.7 lakh) due to an increased rebate.
Even if your income slightly exceeds Rs.12 lakh, you will still get marginal relief, reducing the extra tax burden.
Lower & Simplified Tax Rates
New income tax slabs under the revised tax regime:
Up to Rs. 4 lakh - No TaxRs. 4 lakh to Rs. 8 lakh - 5%
Rs. 8 lakh to Rs. 12 lakh - 10%
Rs. 12 lakh to Rs. 16 lakh - 15%
Rs. 16 lakh to Rs. 20 lakh - 20%
Rs. 20 lakh to Rs. 24 lakh - 25%
Above Rs. 24 lakh - 30%
This means lower tax liability and more savings for middle-income earners!
TDS/TCS Simplified - Less Hassle, More Savings
Higher exemption limits for TDS (Tax Deducted at Source) & TCS (Tax Collected at Source):
Interest on bank deposits - Exemption limit doubled (from Rs. 40,000 to Rs. 50,000 for individuals, Rs. 50,000 to Rs. 1 lakh for senior citizens).
Dividend income - Exemption limit doubled (from Rs. 5,000 to Rs. 10,000).
Insurance commission - Increased from Rs. 15,000 to Rs. 20,000.
Rent - No TDS if rent is below Rs. 50,000 per month
No TCS on high-value goods above Rs. 50 lakh - Businesses benefit from reduced compliance burden.
Easier Tax Compliance - Higher TDS thresholds mean fewer deductions and less paperwork for taxpayers.
Additional Taxpayer Benefits
Self-Occupied Property - No notional rent added for tax purposes if you own a second house but cannot occupy it.
Faster Refunds - Tax processing improvements mean quicker refunds and less paperwork.
Voluntary Tax Compliance Encouraged - Updated tax returns can now be filed within 48 months (earlier 24 months) with a structured penalty.
What This Means for You?
Higher disposable income
Lower tax rates = more savings
Simplified tax deductions = less hassle
Make the most of these new benefits and plan your finances better!