Finance Minister Nirmala Sitharaman has announced during her Union Budget 2025 speech that now no income tax will have to be paid on income up to Rs 12 lakh. The middle class and income tax payers will directly benefit from this. This will also increase the spending capacity of the middle class. Farmers and youth have also been given gifts in the budget.
New Delhi. Finance Minister Nirmala Sitharaman has made a big announcement related to the elderly in the budget. Now they will be able to file updated returns for four years. Exemption has also been announced in the budget for the elderly. At the same time, the TDS limit has been increased to 10 lakhs. The limit for filing updated returns was earlier two years. Now it has been increased to four years.
The Finance Minister announced doubling the limit of tax deduction on interest income for senior citizens to Rs 1 lakh. Apart from this, there is a proposal to increase the limit of TDS on rent to Rs 6 lakh. At the same time, the period of incorporation for startups to get tax benefits has been increased to five years.
No tax on income up to 12 lakhs
Finance Minister Nirmala Sitharaman also announced rationalization of the TDS system. The government will introduce a new Income Tax Bill in Parliament next week. In the budget, the government has given a big gift to the middle class. Now there will be no tax on annual income up to Rs 12 lakh.
Understand Income Tax Lab
Zero tax up to Rs 4 lakh, 5% for Rs 4 to 8 lakh, 10% for Rs 8-12 lakh, 15% for Rs 12-16 lakh, 20% for Rs 16-20 lakh, 25% for Rs 20-24 lakh and 30% tax on more than Rs 24 lakh. The Finance Minister said that this will provide great relief to the middle class.
No tax on withdrawal from National Savings Scheme
The Finance Minister said that delay in payment of TCS by the due date will be taken out of the category of crime. He said that if the loan was taken for education, then TCS on remittance has been waived. The budget has announced tax exemption on withdrawal from National Savings Scheme (NSS) accounts on or after August 2024.
At a glance
- The interest deduction limit for senior citizens has been doubled from Rs 50,000 to Rs 1 lakh.
- The annual limit for TDS on rent has been raised from Rs 2.40 lakh to Rs 6 lakh.
- The TCS limit on remittances under the Liberalised Remittance Scheme (LRS) of the Reserve Bank of India has been raised from Rs 7 lakh to Rs 10 lakh.
- The higher TDS deduction provisions will apply only to non-PAN cases.
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