Taxes: Excellent news! The government has revealed that you can now benefit from these three exemptions under the New Tax Regime.

 Taxes: Excellent news! The government has revealed that you can now benefit from these three exemptions under the New Tax Regime.

Income Tax Return: By giving taxpayers the chance to claim specific deductions, the Union Budget 2023 has made the New Tax Regime appealing. From the assessment year 2023–2024, taxpayers will be able to take advantage of three different types of deductions under the New Tax Regime's proposed changes (FY 2022-23).


New Tax Regime: Finance Minister Nirmala Sitharaman unveiled the 2023–24 budget on February 1. The Finance Minister made a number of significant announcements during this time as well.


During the budget speech, Finance Minister Nirmala Sitharaman also disclosed changes to the income tax slab. The Finance Minister also declared that there will be no tax due on annual income up to Rs. 7 lakhs as part of the new tax system. Additionally, adjustments were made to the tax slab under the new tax regime.


salary tax bracket
The New Tax Regime has become more appealing thanks to the Union Budget 2023, which gives taxpayers the chance to claim specific deductions. From the assessment year 2023–2024, taxpayers will be able to take advantage of three different types of deductions under the New Tax Regime's proposed changes (FY 2022-23). Come, let's examine the three deductions provided by the new tax system outlined in Budget 2023.

Standard deduction for employees and retirees
A standard deduction of Rs 50,000 has been proposed from salary and pension income under the New Tax Regime. Pensioners and those who are paid a salary can deduct Rs. 50,000 as a standard deduction. The employer automatically includes the standard deduction when calculating taxes, so salaried taxpayers do not need to submit a separate application. Pensioners who choose the new tax system would also receive a standard deduction of Rs 15,000 from their family pension.


Deduction under Section 80CCH for Firefighters
The proposed regulations state that section 10 of the tax code will not apply to receipts from the "Agnivar Corpus Fund" made through a nominee under the "Agneepath Scheme 2022." (12C). A new deduction under section 80CCH has been suggested for this. People who enrol in the Agneepath scheme on or after November 1, 2022, will receive a deduction. The deduction will match the Agniveer Corpus Fund contribution, according to the Income Tax Department. This deduction will be accessible under both the old and new tax systems.

The Central Government's contribution to the Agneepath scheme participant's Agniveer Corpus Fund account will be regarded as salary under section 17 of the tax code, per the tax department. Section 80CCH will permit the pertinent deduction.


Section 80CCD deductions (2)
In the new system, the employer's contribution to the employee's National Pension System (NPS) account will also be eligible for a deduction under section 80CCD(2). According to the regulations, a government employee may deduct up to 14% of his salary, while a private sector employee may deduct a maximum of 10% of his salary (basic plus DA).