Revised Income Tax Slab: A significant change for taxpayers Budget 2024 may alter the income tax slab; stay informed here
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| Revised Income Tax Slab: A significant change for taxpayers Budget 2024 may alter the income tax slab; stay informed here |
Old vs new income tax slabs: Finance Minister Nirmala Sitharaman altered the tax slabs in the budget that was unveiled on February 1, 2023. It is anticipated that some adjustments to the income tax slabs may also be made when the whole budget is unveiled in the next year.
Comparing the income tax brackets of the new and previous regimes: On February 1, Finance Minister Nirmala Sitharaman will deliver the nation's budget. However, since it's election year, the budget will only be temporary. This budget will be passed on account, as stated by the Finance Minister himself. Election years do not see the presentation of the whole budget. The whole budget is submitted by the newly elected administration, which takes office two months following the election results.
The public awaits budget news such as tax exemptions. The tax slabs were modified by Finance Minister Nirmala Sitharaman in the budget that was unveiled on February 1, 2023. It is anticipated that some adjustments to the income tax slabs may also be made when the whole budget is unveiled in the next year. However, one should be aware of the new and old tax bracket rates before the fiscal year ends.
Income Tax Regimes: New vs. Old
1. What tax slab should you be in?
At the start of the fiscal year, there is a chance to choose the tax slab. However, there is opportunity for correction at the end of the fiscal year if anything goes wrong. In this case, you can now comprehend whether there is any uncertainty between the new and old slabs. The slab that is the ideal fit for you is what matters most.
2. What is the advantage of the new tax structure?
Following the modifications outlined in Budget 2023, people with income taxes up to Rs 7 lakh are exempt from paying taxes under the new tax system. For individuals in this earning range, the new tax system is a solid choice. Because there is a standard deduction of Rs 50,000 available in addition to the income of Rs 7 lakh. Generally, up to Rs 7 lakh 50, no tax would be due.
3. The new tax system's tax slabs
5% tax on income up to ₹3-6 lakh (tax refund under section 87A) - No tax on income up to ₹3 lakh
10% tax on earnings between ₹6 and 9 lakh; ₹9 to 15% tax on earnings over Rs 12 lakh; ₹20 to 15% tax on earnings between ₹12 and 15 lakh; and 30% tax on earnings above ₹15 lakh.
4- Tax slabs under the previous tax system
- Income up to Rs 2.5 lakh is free from basic exemption tax; income between Rs 2.5 and Rs 5 lakh is subject to 5% tax; income between Rs 5 and Rs 7.5 lakh and Rs 7.5 lakh and Rs 10 lakh is subject to 15% tax. 20% income tax - 30% tax is levied on income above Rs 10 lakh.
5. Investments are eligible for tax exemption.
In the previous tax slabs, tax exemption is available. You may claim tax exemption by making an investment in this. Tax exemptions on investments made under sections 80C and 80D are offered in this. Experts maintain that the previous tax structure was still preferable for those who pay rent or mortgage interest.
Has the 87A rebate increased?
The Section 87A refund was expanded in the most recent budget to cover income up to Rs 7 lakh. At Rs 12500, a tax refund of Rs 5 lakh was offered; on income of Rs 7 lakh, this amount was raised to Rs 25000. This implies that there would be no tax on income up to Rs 7 lakh for taxpayers who choose the new tax system.
