The year ahead is set to bring along with it numerous new rules for taxes on income by the Government of India, which is going to affect salaried workers and the upper class of business. Significant changes were made regarding tax slabs as well as deduction limits and the investments as well as the investment option Income Tax Rules, 2025 which will affect numerous reasons. If you’re involved in your financial plan, this article can be very helpful to your needs. Let’s learn more about the new tax laws.
New Changes In The Tax Slab
According to the Income Tax Rules, 2025 it has seen significant changes to the tax bracket for income. Tax has been increased so that by a factor of 5% for incomes up to 3 lakh. Moreover, five percent of tax is charged on earnings between 3 to 6 lakhs, 10% from 6-9 lakhs as well as 15 percent for income between Rs 9 to 12 lakhs, 20 percent for 13 to 15 lakh and 30 percent for all earnings that exceed Rs 15 lakh. This is a huge relief to those in the middle and upper class.
Standard Deduction Increase
The deduction threshold for standard deductions was increased by the federal government to $75,000 instead of amount of Rs $50,000. This is the limit set for the elderly is 1 lakh. The government has also raised the limit of medical insurance exemption from 25 to 50,000.
New Changes In Section 80C
The government has increased in the ceiling for investment in section 80C. It will increase it from 1.5 lakh to 2 lakh. Tax advantages can now earned from investment alternatives such like PPF, ELSS and life insurance the principal of a home loan as well as Sukanya Samriddhi Yojana under the criterion. Government extended even the option of tax exempt for investing an additional 50k under NPS.
Relaxation On House Rent Income
House Rent Allowance (HRA) Conditions have changed as well. It is now the case that for residents of an urban area, HRA would be calculated at 50% of the actual rent (previously 40 percent) or up to 50% of the basic wage or less, depending on the lower. 40% is the maximum for other areas that are not in cities.
Introduced New Tax Saving Investment Options
The federal government has launched new tax-saving tools like the digital gold or bonds. The new investment options comprise the purchase of startups and also. Additionally, they are granted an exemption from taxation.
Changes In Rules For Freelancers
A new tax scheme has also been designed for freelancers as well as gig workers. They will not pay tax for earnings in excess of INR 5 lakh when they are able to invest in schemes such as PF or Mediclaim. This is a great comfort to young people who are involved through online platforms.
