Income Tax Day 2024: From standard deductions to tax regime updates, what's in for taxpayers
Under the new tax regime, the standard deduction for salaried employees has been increased from Rs 50,000 to Rs 75,000. Similarly, the deduction for family pensioners has been raised from Rs 15,000 to Rs 25,000, providing greater relief to these individuals.
FollowAs India observes Income Tax Day 2024 on July 24, commemorating the introduction of income tax by Sir James Wilson in 1860, this year's celebrations are highlighted by significant updates in the Union Budget 2024. Finance Minister Nirmala Sitharaman unveiled several important changes affecting income taxpayers during her budget speech on Tuesday.
Under the new tax regime, the standard deduction for salaried employees has been increased from Rs 50,000 to Rs 75,000. Similarly, the deduction for family pensioners has been raised from Rs 15,000 to Rs 25,000, providing greater relief to these individuals.
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Limitations on re-assessment of returns:
The budget now specifies that only taxpayers with an annual income exceeding Rs 50 lakh will be subject to the re-assessment of old Income Tax Returns (ITRs) beyond three years. Tax authorities will no longer be able to re-evaluate ITRs of other income taxpayers after this period.
Revised tax regime benefits:
The newly revised tax regime aims to benefit salaried employees with potential savings of up to Rs 17,500 in income tax. Last fiscal year saw over two-thirds of individual taxpayers opting for this new regime, with more than 8.61 crore ITRs filed for FY 24.
Updated tax brackets:
The revised tax regime, effective from April 1, 2025, for the Assessment Year 2025-26, introduces the following tax slabs:
Income up to Rs 3 lakh: Exempt from income tax
Income between Rs 3 lakh and Rs 7 lakh: Taxed at 5%
Income between Rs 7 lakh and Rs 10 lakh: Taxed at 10%
Income between Rs 10 lakh and Rs 12 lakh: Taxed at 15%
Income between Rs 12 lakh and Rs 15 lakh: Taxed at 20%
Income above Rs 15 lakh: Taxed at 30%
These adjustments are designed to simplify the tax process and offer additional relief to taxpayers across different income levels.
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