Exemption for the standard deduction: The government may raise the cap; find out the new amount here

 Exemption for the standard deduction: The government may raise the cap; find out the new amount here

Union Budget 2024: On February 1, 2024, Union Finance Minister Nirmala Sitharaman will make the budget's sixth presentation. The last budget of the Modi government's second term will be presented by Nirmala Sitharaman since nationwide Lok Sabha elections will take place shortly after. The government may make a lot of announcements in this kind of circumstance to capitalize on its voter base, particularly for the salary class.

Union Budget 2024: On February 1, 2024, Union Finance Minister Nirmala Sitharaman will make the budget's sixth presentation. The last budget of the Modi government's second term will be presented by Nirmala Sitharaman since nationwide Lok Sabha elections will take place shortly after. The government may make a lot of announcements in this kind of circumstance to capitalize on its voter base, particularly for the salary class. For those who are employed, the government may raise the standard deduction. The government should raise the standard deduction from Rs 50,000 to Rs 1 lakh, as requested by employed taxpayers. in order to assist people cope with the growing cost of living via a little increase in the amount of money they get. The administration may make some special announcements for its support base, but Finance Minister Nirmala Sitharaman has said that no significant announcements would be made in the budget.

Taxpayers get a standard deduction.

Employees covered by the Income Tax Act are entitled to a unique benefit. Pension recipients are also eligible to benefit from this. We refer to this as Standard Deduction. This involves taking a certain amount out of the employed person's taxable income. As a result, the employee's taxable income is decreased, which lowers his tax burden, or the amount of tax due.

Taxpayers are very relieved

The standard deduction amount is set at Rs 50,000. Pensioners and taxpayers alike are eligible to benefit from this. Taxpayers who work for the government or in the private sector may benefit from this. Taxpayers who work for themselves are not eligible for the standard deduction. In a similar vein, corporate taxpayers are not eligible for this assistance.

Which part allows for the use of this relief?

The Income Tax Act of 1961's Section 16 provides the standard deduction. What makes this unique is that taxpayers may only deduct a set amount, regardless of their yearly income. As a result, this provides significant assistance for low-income taxpayers.

When did it begin?

In 1974, the standard deduction was first implemented. However, this clause was eventually removed. In the 2018 Union Budget, it was brought back. The standard deduction advantage was formerly limited to people who paid income taxes under the previous income tax system. Now, the benefits of the new income tax system are also available to taxpayers who utilize it. The budget that was unveiled on February 1, 2023, included this announcement.