#new tax regime slabs

[targetstudy]

Budget 2024 Highlights, New Tax Regime Slabs, Income Tax & More

This is the Interim budget 2024 which is presented by Finance Minister Nirmala Sitharaman. Nirmala Sitharaman presented her 7th budget in parliament.

In the budget 2024, which came just after the election results, the government has also paid the price for the ‘support’ of the allies. Special packages were given to the Bihar government and the Andhra Pradesh government.

At the same time, new employment opportunities have been opened to address the discontent among the youth who expressed their dissatisfaction in the Lok Sabha elections.

However, by increasing the capital gains tax on stock market investors, the burden on the middle class, already suffering from inflation, has been increased further.

In the new tax system, a slight relief has been provided by increasing the standard deduction from ₹50,000 to ₹75,000. Additionally, changes have been made to the income tax slab.

READ MORE: Budget 2024 Highlights, New Tax Regime Slabs, Income Tax & More

[imdnews1]

Income Tax Budget 2025 : 12 लाख करमुक्त उत्पन्न आणि त्यापेक्षा जास्त उत्पन्न असल्यास कर कसा मोजला जातो?

[my-traders-arena]

💰 Current vs. New Income Tax Regime 💼

Compare the existing tax slabs with the new tax slabs under the updated regime! 📊

👀 Notice the increased thresholds and better tax savings for certain income brackets. 🏦

Understand how the new structure can help you plan your finances smarter! ✅

🌐 www.mytradersarena.com

☎️ 7010133354.

Follow and share your friends.

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@followers

#mytradersarena #mytradersarenaofficial #mytradersarenastockmarket #tradingfloor #chennai #tradingacademy #nirmalasitharaman #india #IncomeTax #NewTaxRegime #FinancePlanning #TaxSavings #Budget2025 #SmartInvesting #MoneyMatters #TaxPayers

Current vs. New Income Tax Regime, Compare Tax Slabs, Updated Tax Regime, Tax Savings, Income Tax Planning, Financial Planning, New Tax Structure, Tax Benefits, Tax Thresholds, Better Tax Savings, Tax Brackets Comparison, Smart Tax Planning, Investment Strategies, Income Tax Updates, Taxpayer Benefits, Personal Finance Management, Tax Rules, Wealth Management, Tax Deductions, Financial Growth.

[newsxbyte]

Income Tax Slabs FY 2025-26 explained: 20 FAQs individual taxpayers should check to understand tax rates, income tax benefit under new tax regime

Income tax slabs FY 2025-26: The most important takeaway is that individuals earning up to Rs 12 lakh will have to pay ZERO tax. (AI image) Latest Income Tax Slabs FY 2025-26 after Budget 2025: The income tax slabs and income tax rates under the new tax regime have been revised for FY 2025-26. The revised income tax slabs were announced by FM Nirmala Sitharaman in her Union Budget 2025 speech.…

[babatax]

"Income Tax" Slightly Over ₹12 Lakh Salary? Do You Pay Full Tax?

Under the new tax regime for the financial year 2025–2026, the Budget 2025 has proposed to make ordinary income up to Rs 12 lakh tax-free. This has become possible due to revised tax slabs and an enhanced rebate of Rs 60,000 under section 87A. However, there has been a great deal of confusion regarding tax on incomes slightly above Rs 12 lakh ever since the new tax system for FY 2025–2026 was…

[jjtax]

Union Budget 2025-26: The Union Minister for Finance, Smt. Nirmala Sitharaman unveiled the Union Budget 2025-26 on February 1, 2025. This year’s budget focuses on economic growth through four major pillars: Agriculture, MSMEs, Investment, and Exports. Here are the highlights:

A. Agriculture

Launch of Prime Minister Dhan-Dhaanya Krishi Yojana to uplift 1.7 crore farmers in 100 low-productivity districts.

National Mission on High-Yielding Seeds to enhance agricultural research and productivity.

Increased loan limit for Kisan Credit Cards (KCC) to ₹5 lakh.

B. MSMEs

Revised MSME classification with higher turnover and investment limits.

₹10,000 crore Fund of Funds to support startups.

Loans up to ₹2 crore for first-time entrepreneurs, with a focus on women and marginalized communities.

C. Investment

People Investments: Advanced skill centers, digital learning initiatives, expanded rural broadband, and enhanced medical education.

Economic Investments: Infrastructure development, Jal Jeevan Mission expansion, and urban growth projects.

D. Exports

Launch of Export Promotion Mission with targeted sector growth.

BharatTradeNet: A new platform for simplifying trade paperwork and financing.

Taxation Highlights

Income Tax Relief: No personal income tax up to ₹12 lakh under the new regime, rising to ₹12.75 lakh for salaried taxpayers.

Revised Tax Slabs (New Regime):

₹0-4,00,000: 0%

₹4,00,001-8,00,000: 5%

₹8,00,001-12,00,000: 10%

₹12,00,001-16,00,000: 15%

₹16,00,001-20,00,000: 20%

₹20,00,001-24,00,000: 25%

Above ₹24,00,000: 30%

Other notable updates:

Higher TDS limit on rent (₹6 lakh annually).

TCS threshold for LRS remittances increased to ₹10 lakh.

Decriminalization of delayed TCS payments (if paid by the filing due date).

Impact on Individuals and Businesses

For Individuals:

More disposable income with higher tax-free thresholds and revised slabs.

Employment opportunities via infrastructure projects.

Better healthcare access and affordability through expanded National Digital Health Mission.

Focus on skill development and digital learning for an employable workforce.

For Businesses:

Simplified GST compliance and “ease of doing business” initiatives, especially for MSMEs.

Investments in infrastructure and “Make in India” to boost growth.

A Deep Tech Fund to support innovation in AI, ML, and advanced technologies.

Have queries about how this budget affects you or your business? 🧐 Our expert CAs at JJ Tax are here to help!

JJ Tax would love to hear any queries you may have about the union budget. Consider our team of expert CAs at your disposal when you book a FREE 15-minute call from our website at www.jjfintax.com. Download JJ TAX APP

[newspatrolling]

How Much Tax For 15 Lakh Salary?

With the new tax slabs announced, salaried individuals with Rs 15 lakh per annum income can save up to Rs 32,500

The 2025 Union Budget has brought cheer for the middle class, as the tax slabs for salaried individuals have been revised. Let us compare the old tax slab vs. the new tax slab to understand how much tax will be applicable on a salary of Rs 15 lakh per annum.

Annual Salary Rs 15 lakh - Old Tax slabIncome-Tax SlabsPrevious Tax Rate Tax PayableUp to Rs 3 LakhNilNilRs 3 Lakh to Rs 7 Lakh5%Rs 20,000Rs 7 Lakh to Rs 10 Lakh10%Rs 30,000Rs 10 Lakh to Rs 12 Lakh15%Rs 30,000Rs 12 Lakh to Rs 15 Lakh20%Rs 45,000Above Rs 15 Lakh30%NA

Tax Payable DetailsDescriptionAmountTax Payable (Including Cess)Rs 1,25,000Cess at 4%Rs 5,000Total Tax LiabilityRs 1,30,000

Annual Salary Rs 15 lakh - New Tax slabIncome-Tax SlabsNew Tax Rate Tax PayableUp to Rs 4 LakhNilNilRs 4 Lakh to Rs 8 Lakh5%Rs 20,000Rs 8 Lakh to Rs 12 Lakh10%Rs 40,000

Rs 12 Lakh to Rs 16 Lakh

(Rs 12.75 Lakh to Rs 15 Lakh = Rs 2.25 Lakh)15%Rs 33,750Rs 16 Lakh to Rs 20 Lakh20%NARs 20 Lakh to Rs 24 Lakh25%NAAbove Rs 24 Lakh30%NA

Tax Payable DetailsDescriptionAmountTax PayableRs 93,750Cess at 4%Rs 3,750Total Tax LiabilityRs 97,500

As is evident from above, the total tax liability on Rs 15 LPA as per old tax slab is Rs 1,30,000. But in the New Tax slab, the tax liability for Rs 15 LPA is Rs 97,500. That means savings of Rs 32,500 per year.

Important things to note about New Tax regime 2025

Zero tax till income of Rs 12.75 lakh / Full tax rebate under Section 87A - Under the new tax regime, the tax rebate available under Section 87A has been increased from Rs 25,000 to Rs 60,000. This effectively makes the total tax NIL on income of up to Rs 12.75 lakh.

Capital gains to be taxed separately - The Zero tax scheme will apply only to income earned exclusively via salary. If there are capital gains, that component will be taxed separately.

Option to choose between old and new tax regime - With significant benefits available in the tax slabs, it is expected that most taxpayers will shift to the new tax regime. In the last financial year 2023-24, around 72% taxpayers had opted for the new tax regime. With the revised tax slabs, more  than 90% taxpayers are expected to shift to the new tax regime.

Nex tax regime applicable on FY 2025-26 - The new tax regime will come into force from the new financial year 2025-26. It is subject to approval from the parliament.

source: newspatrolling.com

[lawyer2ca]

Highlights of Budget 2025 - @lawyer2ca®️

✅The income tax slabs under the new regime are:

Up to ₹ 4 lakh - 0% tax

Between ₹ 4 & 8 lakh - 5% tax

Between ₹ 8 & 12 lakh - 10% tax

Between ₹ 12 lakh & 16 lakh - 15% tax

Between ₹ 16 lakh & 20 lakh - 20% tax

Between ₹ 20 lakh & 24 lakh - 25% tax

Above ₹ 24 lakh above - 30% tax

✅Standard deduction of ₹ 75,000 for the New Alternate Tax Regime

✅For the New Alternate Tax Regime cases, there will be no tax if the total income is up to ₹ 12.75 lakhs

✅The timeline to file an updated tax return for any assessment year extended from two to four years from the end of that assessment year; The additional tax payable with such updated tax return to be 60 per cent of the interest and tax liability if filed in the third year and 70 per cent if filed in the fourth year

✅Tax payers to be allowed to claim the annual value of 02 self occupied properties (previously 01) without any conditions (previously conditions attached).

#Lawyer2CA #entrepreneur #IncomeTax #UnionBudget2025 #NirmalaSitharaman #finance #Global #indian #Budget2025

[kknnews]

Income Tax Slabs for FY 2025-26: Comparing New vs. Old Tax Regimes – Which is Better for You?

Income Tax Slabs for FY 2025-26: Comparing New vs. Old Tax Regimes – Which is Better for You...

KKN Gurugram desk | In her Union Budget speech for 2025, Finance Minister Nirmala Sitharaman announced significant income tax relief aimed at providing substantial benefits for middle-class taxpayers in India. A major highlight was the elimination of income tax for individuals earning up to Rs. 12.75 lakh annually, marking a crucial shift in the income tax structure for the financial year…

[news365timesindia]

bySubhash Chandra Agrawal Much awaited new Income Tax Act is announced to be introduced shortly in the Union Budget for fiscal-year 2025-26 to replace six decades old Income Tax Act 1961. It should be expected that new Income Tax Act will simplify Direct Tax system. Rather it would have been better that new Income Tax Act would have been simultaneously introduced with the Union Budget. Drastic cut in tax-slabs is welcome, but there is no clarity if surcharges and cess exist or not. Tax-payer is confused if income is tax-free till rupees 12 lakhs per annum with tax-slabs existing for incomes between rupees 4 lakhs and 12 lakhs. Evidently normal tax-payer is not educated enough that it will be possible only due to relief available under section 87A of Income Tax Act 1961. Incomes exceeding rupees 12 lakh will deprive tax-payer of relief available under section 87A of Income Tax Act 1961. Direct tax-system could be most simplified by raising basic tax-exemption limit anywhere between rupees 4 lakhs and rupees 12 lakhs but abolishing confusing relief available under section 87A of Income Tax Act 1961. There should be only one tax-regime abolishing old tax-regime. Net tax-rate should not exceed 30-percent abolishing system of surcharges and cess to be in tune with most other countries of the world in accordance with recommendations of Raja Chelliah Committee for better tax compliance. With tax-slabs drastically cut, tax-exemptions including on charity, donation, contribution to political parties and even agricultural-income which are largely misused should be abolished. An ordinary farmer does not earn more than rupees four lakhs per annum, and the provision is grossly misused by ultra-rich persons including known celebrities to declare their unaccounted income as agricultural income through some village-land purchased only for whitening the black income without having any agricultural produce. India should step towards cashless economy like in Sweden by taking bold steps to bring cash in circulation in banking economy as was visualised at time of demonetisation of currency on 08.11.2016. A permanent Voluntary Disclosure Scheme can be introduced whereby provision may be there in tax-return to declare at highest suggested tax-rate of 30-percent, any income without disclosing source of income. This will make cash-transaction specially in property-deals accounted if registration-fees on property-deals is also reduced to say just five-percent inclusive of municipal taxes and capital-gain further cut to 10-percent like on shares. Names of all those disclosing incomes under suggested highest 30-percent slab should be on website according to income disclosed so that status-conscious persons may race to disclose more incomes. LK Jha committee recommendations to make calendar-year as fiscal-year should be implemented to be in line with most countries of the world, thus abolishing another British legacy of following April-March presently as Fiscal Year. It is ridiculous to have different Depreciation-Rules for Tax and Corporate audits. There should be a single and unified Tax and Corporate Audit. All sale-purchases above rupees 10000 must be compulsorily through bank-transactions. For this, transaction-charges on credit-cards should be slashed down to just half-percent (GST-exempted) that too to be borne by central government with all incentives on purchases made through credit-cards abolished. Present high two-percent transaction-charges on credit-cards make traders charge it separately from customers specially where trade-margins are low. System will fetch much higher tax-revenue for government, than through half-percent transaction-charges to be borne by government. Banks issuing credit-cards will get much-more earning even with half-percent transaction-charge because of manifold use of credit-cards. Two sets of credit-card swapping-machines should be compulsory for every GST-registered dealer so as to avoid declining payment through credit-cards with usual excuse that swapping-machine is out of order.

Strict-most action must be there against those refusing payment through credit/debit cards.  Input-Tax-Credit system in GST-regime in manufacturing-sector is biggest corrupt practice of tax-evasion where left-out GST-invoices by ordinary customers are sold by traders to consuming manufacturers or producers to avail false Input-Tax-Credit where cash is paid back by traders to those purchasing left-out GST-invoices of actual consumers bringing more currency in circulation, this being the reason of rapid and regular rise in currency-circulation. Annual forensic audit may be made compulsory on claims made for Input-Tax-Credit by manufacturers/producers to avoid false claims of excessive Input-Tax-Credit in these sectors. Rather study should be made if with abolition of 18-percent GST slab, Input-Tax-Credit can be altogether abolished from manufacturing/producing sectors, retaining it only on tradable commodities.  Input-Tax-Credit system under GST should not be available on expenses like has rightly be done in case of car-expenses for non-commercial use. With such large-scale reduction in Input-Tax-Credit and merging GST-slabs of 3 and 5 percent into a new slab of 6-percent apart from raising 28-percent GST slab to 30-percent, it may be possible to abolish 18-percent GST-slab thus reducing GST-slabs to just 6, 12 and 30-percent. India is the only country which has so many GST-rates. Gradually even slabs of 6 and 12 percent may also be replaced by a new 10-percent tax-structure. Zero-percent GST may only be retained on totally unbranded raw-materials which cannot be consumed without giving a finishing touch like agricultural-products, fish, meat, cotton-yarn etc. All items of long-term use like cars, air-conditioners, TV-sets, refrigerators etc may attract 30-percent GST while their parts may uniformly attract 12-percent GST. It is ridiculous that clutch-plate and clutch-bearing are under different GST-slabs of 18 and 28 percent. Likewise different food-items like sweets, biscuits, namkins etc attract different GST-slabs with luxury sweets causing diabetes attracting just 5-percent GST. Invoices for items like gold-jewellery can be drawn in two parts, one for metal and embodied items and the other for making-charges so that suggested 12-percent GST may be payable only on making-charges. Cess on extra-luxurious items should be replaced by additional GST-slabs in multiples of 60-percent, also bringing petroleum products under GST-regime to ensure uniform pricing of petrol and diesel in all states.  With GST-slab of 18-percent abolished and service sector then attracting just 12-percent GST, those with income of rupees ten lakhs or more (instead of present rupees 20 lakhs) can be brought under GST-regime like was the system before GST-regime with lawyers also coming under purview of GST-regime. Useless system of Tax-Deducted-At-Source for GST, which is hardly used in practice, should be altogether abolished. All government-payments can be considered to be exempted from GST to avoid unnecessary government-accounting by putting tax from one government-pocket to other. It is illogical that some premium postal-services like Speed-Post may attract GST while other postal-services do not attract GST. Even illogical and irrational postal-rates (both inland and foreign) need simplification for equal rise of postal-tariff for equal rise in slab-weight in multiples of 50 gms. of inland postal-article with all postal-tariffs being in multiples of rupees ten except for registered-newspapers and post-cards which may cost rupee one with abolition of outdated Inland-Letter-Cards. Presently a postal-article weighing 200 gms sent locally by reliable and fast Speed Post costs just rupees 30 but if sent by unreliable ordinary post, it will cost rupees 50. Likewise foreign-mail tariffs can be fixed for 20 gms or part slab-weight independently for air and sea-surface-mail. Writer is Guinness World Record Holder for writing most letters and RTI Consultant

[news365times]

bySubhash Chandra Agrawal Much awaited new Income Tax Act is announced to be introduced shortly in the Union Budget for fiscal-year 2025-26 to replace six decades old Income Tax Act 1961. It should be expected that new Income Tax Act will simplify Direct Tax system. Rather it would have been better that new Income Tax Act would have been simultaneously introduced with the Union Budget. Drastic cut in tax-slabs is welcome, but there is no clarity if surcharges and cess exist or not. Tax-payer is confused if income is tax-free till rupees 12 lakhs per annum with tax-slabs existing for incomes between rupees 4 lakhs and 12 lakhs. Evidently normal tax-payer is not educated enough that it will be possible only due to relief available under section 87A of Income Tax Act 1961. Incomes exceeding rupees 12 lakh will deprive tax-payer of relief available under section 87A of Income Tax Act 1961. Direct tax-system could be most simplified by raising basic tax-exemption limit anywhere between rupees 4 lakhs and rupees 12 lakhs but abolishing confusing relief available under section 87A of Income Tax Act 1961. There should be only one tax-regime abolishing old tax-regime. Net tax-rate should not exceed 30-percent abolishing system of surcharges and cess to be in tune with most other countries of the world in accordance with recommendations of Raja Chelliah Committee for better tax compliance. With tax-slabs drastically cut, tax-exemptions including on charity, donation, contribution to political parties and even agricultural-income which are largely misused should be abolished. An ordinary farmer does not earn more than rupees four lakhs per annum, and the provision is grossly misused by ultra-rich persons including known celebrities to declare their unaccounted income as agricultural income through some village-land purchased only for whitening the black income without having any agricultural produce. India should step towards cashless economy like in Sweden by taking bold steps to bring cash in circulation in banking economy as was visualised at time of demonetisation of currency on 08.11.2016. A permanent Voluntary Disclosure Scheme can be introduced whereby provision may be there in tax-return to declare at highest suggested tax-rate of 30-percent, any income without disclosing source of income. This will make cash-transaction specially in property-deals accounted if registration-fees on property-deals is also reduced to say just five-percent inclusive of municipal taxes and capital-gain further cut to 10-percent like on shares. Names of all those disclosing incomes under suggested highest 30-percent slab should be on website according to income disclosed so that status-conscious persons may race to disclose more incomes. LK Jha committee recommendations to make calendar-year as fiscal-year should be implemented to be in line with most countries of the world, thus abolishing another British legacy of following April-March presently as Fiscal Year. It is ridiculous to have different Depreciation-Rules for Tax and Corporate audits. There should be a single and unified Tax and Corporate Audit. All sale-purchases above rupees 10000 must be compulsorily through bank-transactions. For this, transaction-charges on credit-cards should be slashed down to just half-percent (GST-exempted) that too to be borne by central government with all incentives on purchases made through credit-cards abolished. Present high two-percent transaction-charges on credit-cards make traders charge it separately from customers specially where trade-margins are low. System will fetch much higher tax-revenue for government, than through half-percent transaction-charges to be borne by government. Banks issuing credit-cards will get much-more earning even with half-percent transaction-charge because of manifold use of credit-cards. Two sets of credit-card swapping-machines should be compulsory for every GST-registered dealer so as to avoid declining payment through credit-cards with usual excuse that swapping-machine is out of order.

Strict-most action must be there against those refusing payment through credit/debit cards.  Input-Tax-Credit system in GST-regime in manufacturing-sector is biggest corrupt practice of tax-evasion where left-out GST-invoices by ordinary customers are sold by traders to consuming manufacturers or producers to avail false Input-Tax-Credit where cash is paid back by traders to those purchasing left-out GST-invoices of actual consumers bringing more currency in circulation, this being the reason of rapid and regular rise in currency-circulation. Annual forensic audit may be made compulsory on claims made for Input-Tax-Credit by manufacturers/producers to avoid false claims of excessive Input-Tax-Credit in these sectors. Rather study should be made if with abolition of 18-percent GST slab, Input-Tax-Credit can be altogether abolished from manufacturing/producing sectors, retaining it only on tradable commodities.  Input-Tax-Credit system under GST should not be available on expenses like has rightly be done in case of car-expenses for non-commercial use. With such large-scale reduction in Input-Tax-Credit and merging GST-slabs of 3 and 5 percent into a new slab of 6-percent apart from raising 28-percent GST slab to 30-percent, it may be possible to abolish 18-percent GST-slab thus reducing GST-slabs to just 6, 12 and 30-percent. India is the only country which has so many GST-rates. Gradually even slabs of 6 and 12 percent may also be replaced by a new 10-percent tax-structure. Zero-percent GST may only be retained on totally unbranded raw-materials which cannot be consumed without giving a finishing touch like agricultural-products, fish, meat, cotton-yarn etc. All items of long-term use like cars, air-conditioners, TV-sets, refrigerators etc may attract 30-percent GST while their parts may uniformly attract 12-percent GST. It is ridiculous that clutch-plate and clutch-bearing are under different GST-slabs of 18 and 28 percent. Likewise different food-items like sweets, biscuits, namkins etc attract different GST-slabs with luxury sweets causing diabetes attracting just 5-percent GST. Invoices for items like gold-jewellery can be drawn in two parts, one for metal and embodied items and the other for making-charges so that suggested 12-percent GST may be payable only on making-charges. Cess on extra-luxurious items should be replaced by additional GST-slabs in multiples of 60-percent, also bringing petroleum products under GST-regime to ensure uniform pricing of petrol and diesel in all states.  With GST-slab of 18-percent abolished and service sector then attracting just 12-percent GST, those with income of rupees ten lakhs or more (instead of present rupees 20 lakhs) can be brought under GST-regime like was the system before GST-regime with lawyers also coming under purview of GST-regime. Useless system of Tax-Deducted-At-Source for GST, which is hardly used in practice, should be altogether abolished. All government-payments can be considered to be exempted from GST to avoid unnecessary government-accounting by putting tax from one government-pocket to other. It is illogical that some premium postal-services like Speed-Post may attract GST while other postal-services do not attract GST. Even illogical and irrational postal-rates (both inland and foreign) need simplification for equal rise of postal-tariff for equal rise in slab-weight in multiples of 50 gms. of inland postal-article with all postal-tariffs being in multiples of rupees ten except for registered-newspapers and post-cards which may cost rupee one with abolition of outdated Inland-Letter-Cards. Presently a postal-article weighing 200 gms sent locally by reliable and fast Speed Post costs just rupees 30 but if sent by unreliable ordinary post, it will cost rupees 50. Likewise foreign-mail tariffs can be fixed for 20 gms or part slab-weight independently for air and sea-surface-mail. Writer is Guinness World Record Holder for writing most letters and RTI Consultant

[taxguidenilesh]

Salary TDS: बदल गया है सैलरी पर टीडीएस कटौती का तरीका - How to calculate TDS on salary in hindi - Tax Guide

Salary TDS: Employee की सैलरी पर टीडीएस कटौती करने का उत्तरदायित्व employer पर है. Employee की salary करमुक्त सीमा से अधिक है तो वेतन से TDS की कटौती करनी होती है, इसलिए कर्मचारी की पूर्ण वित्त वर्ष के लिए सैलरी से अनुमाणित आय की गणना करनी होती है. FY 2023-2024 से सैलरी पर टीडीएस कटौती का तरीका बदल चूका है, जो सभी वेतनभोगी करदाताओ को पता होना जरुरी है. इस लेख में हम बात करेगे की How to calculate TDS on salary? और क्या है नया तरीका सैलरी से अनुमाणित आय की गणना करने का और उसपर टीडीएस deduction का?

[newsxbyte]

Budget 2025: From new income tax slabs & rates to TDS, TCS & NPS Vatsalya - top 7 income tax takeaways for middle class

One of the major amendments proposed in the current budget is the change in the tax rates and slabs under the Concessional Tax Regime. By Surabhi MarwahBudget 2025 income tax: The Finance Minister in her budget speech stated that taxation reforms were one of the key reforms to realise the vision of “Viksit Bharat”. The personal tax proposals in the budget presented today were made keeping in…

[dewami]

Zero Tax Up to Rs 12 Lakh: A Closer Look at the Income Parity

In a move that has brought relief to many taxpayers, Finance Minister Nirmala Sitharaman’s Union Budget 2025-26 announced that individuals with taxable income up to Rs 12 lakh would be exempt from paying any income tax. While this news has been widely celebrated, there’s an interesting twist for those whose income slightly exceeds Rs 12 lakh.

As per the new tax regime, individuals with taxable income just above Rs 12 lakh face a sudden rise in tax liability. For example, someone with a taxable income of Rs 12.1 lakh will have to pay Rs 61,500 in taxes, effectively taking home Rs 51,500 less than someone earning exactly Rs 12 lakh.

The income tax burden continues to increase incrementally, but the real kicker is that parity in take-home salary is only restored when taxable income reaches Rs 12.71 lakh. At this level, the tax liability is Rs 70,500, but the take-home salary will still be equal to that of someone earning Rs 12 lakh.

This creates a peculiar situation where individuals earning slightly above Rs 12 lakh might find themselves with a smaller net salary compared to those earning exactly Rs 12 lakh, raising questions about the design of the tax slab and its impact on marginal income increases. Read Also :

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