New tax regime: In the new tax regime, tax exemption will be available on NPS, Agneepath Yojana and recruitment of new employees. In Budget 2025, tax rebate has been increased to ₹ 60,000. Travel, daily expenses and allowances for disabled employees will be available in both tax systems. Taxpayers can also choose the old system.
Add informalnewz.com as a Preferred Source
New Tax Deductions: The new tax regime is being adopted rapidly and the government wants most taxpayers to adopt it. So far, about 73% of taxpayers have opted for it, and the government expects this figure to reach 90% by next year. Although many traditional exemptions and deductions are not available in the new system, relief is still available in select cases.
The government has made some new changes in Budget 2025, including tax rebates and some special exemptions. Here’s what are the cases where you can get tax relief.
Also Read- Big announcement of the central government! There will be no tax on senior citizens above 75 years of age? know details
In which cases will tax exemption be available?
- Employer’s contribution to NPS – If the employer contributes to the National Pension System (NPS), it will be tax free under section 80CCD (2).
- Income from Agneepath Yojana – Income earned under Agneepath Yojana is exempted from tax under 80CCH.
- Deduction on recruitment of new employees – If the business recruits new employees, it will get 30% additional tax exemption for three years under 80JJAA.
Changes in tax rebate
Under Budget 2025, the tax rebate available under Section 87A has been increased. Till FY 2023-24, it was ₹25,000 but from FY 2025-26, it has been increased to ₹60,000.
Allowances available in both tax systems
Some allowances will continue to be available in both tax systems, whether new or old:
- Travel expenses during transfer or tour
- Reimbursement of daily expenses incurred while travelling for work
- Commuting expenses if the employer does not provide transport facility
- Transport allowance for blind, hearing impaired, deaf-mute or severely disabled employees
Also Read- Work From Home: Big news for employees! Strictness on work from home in TCS, know details
Option to choose the old tax system
If a taxpayer wants, he can leave the new tax system and adopt the old system. But, before this, it is necessary to compare both the options and see which system will be more beneficial for you.
