Income Tax Slabs: Big news! 8 benefits of new tax regime, see all the details from income tax slab to standard deduction

Income Tax Slabs: It is essential for you to know whether or not the new tax regime is best or the previous one. Today we are going to inform you 8 benefits of the new tax system, which have been instructed by our specialists CA Ajay Bagadia, CA Santosh Mishra and CA Abhinandan Pandey.

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Income Tax Slabs: If you’re going to file ITR for the monetary yr (2023-24) i.e. evaluation yr 2024-25, then it is rather vital for you to know whether or not the new tax regime is best or the previous. Today we are going to inform you 8 benefits of the new tax system, which have been instructed by our specialists CA Ajay Bagadia, CA Santosh Mishra and CA Abhinandan Pandey.

8 benefits of the new tax system

1) Lower tax charges
Tax payers can profit from decrease tax charges in the new tax regime. This will lead to decrease tax legal responsibility and better disposable income.

CA Ajay Bagadia stated that the Modi authorities is emphasizing on the new tax regime by making it extra engaging for taxpayers. The new tax regime provides considerably decrease tax charges to taxpayers.

2) Simple tax construction
The new tax regime has made this tax construction very simple by providing decrease tax charges. The slabs beneath the new tax regime are as follows.

No tax on income up to Rs 3 lakh.

• Income between Rs 3 lakh to Rs 6 lakh shall be taxed at 5 p.c (tax exemption accessible beneath part 87A)
• Income between Rs 6 lakh and Rs 9 lakh shall be taxed at 10 p.c (tax exemption is on the market beneath Section 87A on income up to Rs 7 lakh).
• Income between Rs 9 lakh and Rs 12 lakh shall be taxed at 15 p.c.
• There is a provision of 20 p.c tax on income between Rs 12 lakh and Rs 15 lakh.
• Income of Rs 15 lakh and above shall be taxed at 30 p.c.

3) No tax cuts

Under the new system, the want to observe and declare tax deductions has been achieved away with so as to save effort and time for taxpayers.

“Taxpayers don’t even have to undergo the problem of gathering and submitting details and proof for bills and investments,” says CA Abhinandan Pandey.

4) Basic Exemption Limit

CA Santosh Mishra says, “The fundamental exemption restrict has been elevated from ₹2.5 lakh to ₹3 lakh. This elevated exemption restrict makes the new tax regime extra engaging. Note that the highest tax charge i.e. 30% shall be imposed on income above Rs 15 lakh.”

5) Change in surcharge charge

With the implementation of the new tax system, the surcharge has decreased from 37% to 25%. This is relevant for people with income above Rs 5 crore. This decreased surcharge is legitimate just for these taxpayers who go for the new tax regime and whose income is greater than ₹5 crore.

6) Change in exemption restrict

CA Ajay Bagadia says, “The exemption restrict relevant for income up to Rs 5 lakh beneath the previous tax regime is Rs 12,500. However, beneath the new tax regime if the taxable income is lower than or equal to ₹7 lakh, it Exemption restrict elevated to ₹25,000. Note that Section 87A exemption is relevant beneath each income tax regimes. Again, the Budget announcement elevated the taxable restrict from ₹5 lakh to ₹7 lakh.”

7) Standard Deduction

The standard deduction for salaried people beneath each the previous and new regimes is ₹50,000.

8) Rebate on depart encashment

Under the new tax regime, you’re going to get exemption on depart encashment. CA Santosh Mishra says, “In Budget 2023, the exemption restrict for depart encashment for non-government staff was elevated by 8 instances i.e. from ₹ 3 lakh to ₹ 25 lakh. Therefore, as per part 10(10AA) on retirement, ₹ Leave encashment up to Rs 25 lakh is tax free.

Other deductions beneath the new system

Deduction of Rs 15,000 or 1/3 of pension (whichever is much less) from household pension income.

Deduction of quantity paid or deposited in Agniveer Corpus Fund beneath part 80CCH(2).

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