FM Says Salaried Employees Under New Tax Regime To Save Rs 17,500 Annually, Here's How

Budget 2024: Salaried employees under new tax regime to save up to Rs 17,500 annually in taxes due to changes proposed in Budget FY25, announced Finance Minister Nirmala Sitharaman on Tuesday.

The new tax slabs under the new income tax regime will be effective from April 1, 2024. (Assessment Year 2025-26).

FM proposed the following changes in the new tax regime;

– Standard deduction for salaried employees increased to Rs 75,000 from Rs 50,000

Budget 2024 income tax slab

In the new regime, the tax structure is proposed to be revised as follows:

• 0- Rs 3 lakh – Nil
• Rs 3-7 lakh – 5%
• Rs 7-10 lakh- 10%
• Rs 10-12 lakh -15%
• Rs 12-15 lakh – 20%
• Above Rs 15 lakh – 30%

How Will You Save Rs 17,500?

Dipesh Jain, Partner at Economic Laws Practice, explained;

• The slab rate reduction effect will be Rs 10,000.
• Standard deduction Rs 25,000 additional @ 30% = Rs 7,500
  Rs 10,000 + Rs 7,500 = Rs 17,500

Dipesh Jain said, “While the base exemption limit of Rs 3 lakhs has remained unchanged, which was expected to be increased marginally, the 5% tax slab is proposed to be expanded by Rs 1L ie Rs 3L – 7L from the existing slab of Rs 3L – 6L."

“The highest tax slab of 30% continues to be status quo ie more than Rs 15L. Accordingly, there would be a marginal relief of Rs 17,500 for individual taxpayers opting for the new regime. This would further enhance the attractiveness of the new tax regime as compared to the old tax regime, where there are no relaxations proposed," Jain said.

Stay informed with our comprehensive coverage of Union Budget 2024. Get the latest on new income tax slab rates for AY 2024-25 in Income Tax Slabs Budget 2024 LIVE Updates . Track the impact of Budget 2024 on the stock market in Stock Market Budget Day 2024 LIVE Updates. Watch Union Budget LIVE Streaming here

“The highest tax slab of 30% continues to be status quo ie more than Rs 15L. Accordingly, there would be a marginal relief of Rs 17,500 for individual taxpayers opting for the new regime. This would further enhance the attractiveness of the new tax regime as compared to the old tax regime, where there are no relaxations proposed," Jain said.

Stay informed with our comprehensive coverage of Union Budget 2024. Get the latest on new income tax slab rates for AY 2024-25 in Income Tax Slabs Budget 2024 LIVE Updates . Track the impact of Budget 2024 on the stock market in Stock Market Budget Day 2024 LIVE Updates. Watch Union Budget LIVE Streaming here