New Delhi: Finance Minister Nirmala Sitharaman announced the new limit for an income tax rebate in Budget 2023-24. Under the new tax regime, the income tax rebate limit has been increased from Rs 5 lakh to Rs 7 lakh. She also announced the new income tax slabs in the Parliament.
Personal income-tax | Income tax- rebate extended on income up to Rs 7 lakhs in new tax regime: FM Sitharaman pic.twitter.com/X8rmVH7Gh2
— ANI (@ANI) February 1, 2023
Under the new tax regime, individuals with income up to Rs 7 lakh per annum will get an income tax rebate. The new tax regime has been made the default tax regime by the government, though there is still an option to get a rebate as per the old tax regime.
How will individuals with income up to Rs 7 lakh will not have to pay an income tax?
According to the announcement, individuals with income up to Rs 7 lakh per annum will not have to pay an income tax. So check out how it is possible:
| Old tax regime: No tax up to Rs 5 lakh | New tax regime: No tax up to Rs 7 lakh | |
| Annual Income | Rs 6.5 lakh | Rs 7 lakh |
| Concession under Section 80C | Rs 1.5 lakh | Rs 1.5 lakh |
| Taxable income | Rs 5 lakh | Rs 5.5 lakh |
| Tax | 5% | 5% |
| Tax slab | No tax up to Rs 2.5 lakh | No tax up to Rs 3 lakh |
| Tax on taxable income | Rs 12,500 | Rs 12,500 |
| Rebate under Section 87A | Rs 12,500 | Rs 12,500 |
| Net tax | 0 | 0 |
Finance Minister also announced the new tax slabs for income tax, these are as follows:
Rs 0-3 lakh: NIL
Rs 3-6 lakh: 5%
Rs 6-9 lakh: 10%
Rs 9-12 lakh: 15%
Rs 12-15 lakh: 20%
Above Rs 15 lakh: 30%
MAJOR RELIEF TO ALL TAXER PAYERS IN NEW REGIME
NEW TAX RATES :
0-3 lakh : Nil
3-6 Lakh : 5%
6- 9 Lakh : 10%
9-12 Lakh:15%
12-15 lakh:20%
above 15 lakh: 30%
An Individual with an annual income of 9 lakhs will be required to pay only 45,000 :FM @nsitharaman pic.twitter.com/zwleFQGCkX— All India Radio News (@airnewsalerts) February 1, 2023
The tax slabs were last changed in the financial year 2017-18 while the 20% slab was added back in 2020.
