back to top

info@ceoreporter.com
Call/WhatsApp 9717681813

New Income Tax Rules From April 1

Share:

New Income Tax Rules From April 1:

As the financial year set to begin. The new tax regulations are set to be enforced starting April 1, 2024. These amendments, as outlined by Union Finance Minister, Nirmala Sitharaman in the budget 2023, entail modifications in income tax slabs, surcharge rates, rebates, and more. Here are the full details.

Default Option: New Tax Regime

One of the major changes is the introduction of the new tax regime as the default option for taxpayers. Starting from the fiscal year 2023-24, taxpayers must choose between the old and new tax regimes, with the latter serving as the default option for FY 2023-24.

Revised Income Tax Slabs

Under the new tax regime, revised income tax slabs will be applicable, categorized based on total income. These adjustments aim to streamline the taxation process for taxpayers. Here’s a breakdown:

Total Income Income Tax Rate
Above Rs 15 Lakhs 30%
Between 12 Lakhs To 15 Lakhs 20%
Between 9 Lakhs To 12 Lakhs 15%
Between 6 lakhs To 9 lakhs 10%
Between 3 lakhs To 6 Lakhs 5%
Between 0 To 3 lakhs 0%

Advantages of the New Income Tax Regime

The implementation of the new tax regime offers several benefits to taxpayers:

  • Simplified Tax Planning: The revised regime eliminates the need for complex tax planning strategies, providing taxpayers with a more straightforward approach to taxation.
  • Increased Exemption Limit: The basic exemption limit has been raised from Rs. 2.5 lakhs to Rs. 3 lakhs, enhancing the appeal of the new tax regime.
  • Reduced Surcharge Rate: The surcharge rate has been reduced from 37% to 25% for individuals with income exceeding Rs. 5 Crores.

Changes in Rebate and Deductions

Under the new tax regime, there have been alterations in rebate limits and deductions, including:

  • Increased Rebate Limit: The rebate limit has been raised to Rs. 25,000 for taxable incomes up to Rs. 7 lakhs.
  • Standard Deduction: Salaried individuals can avail a standard deduction of Rs. 50,000 under both the old and new tax regimes.

Changes in Tax Exemptions

In Budget 2023, a tax rebate was introduced for incomes up to Rs. 7 lakhs, implying no income tax liability for taxpayers within this bracket. Additionally, exemptions on leave encashment have been extended, providing relief for retirees.

Flexibility to Switch Tax Regimes

Taxpayers have the flexibility to switch between the old and new tax regimes based on their income type. However, professional or business income allows for a one-time switch, while other income types permit yearly transitions.

Conclusion

The new income tax rules effective from April 1, 2024, bring significant changes aimed at simplifying the taxation process and providing relief to taxpayers. With revised slabs, deductions, and exemptions, taxpayers have more flexibility and clarity in their tax planning strategies.

FAQs

  1. Can taxpayers opt-out of the new tax regime?
    • Yes, taxpayers have the option to opt-out of the new tax regime and choose the old regime if it aligns better with their financial situation.
  2. Are the new tax slabs applicable to all taxpayers?
    • The new tax slabs are applicable to individual taxpayers, including salaried individuals, freelancers, and professionals.
  3. What happens if I forget to choose a tax regime?
    • In case a taxpayer fails to choose a tax regime, the new tax regime will be automatically applied as the default option.
  4. Are there any additional benefits for senior citizens under the new tax rules?
    • Yes, senior citizens are eligible for additional deductions and exemptions under both the old and new tax regimes.
  5. Can taxpayers switch tax regimes multiple times within a financial year?
    • No, taxpayers are generally allowed to switch tax regimes only once a year, except for specific circumstances.

Top 5 ways to Earn Money Online

Certainly! Here are five effective ways to earn money online by selling physical products: E-commerce Platforms: Utilize established e-commerce platforms like Amazon, eBay, or...

NASA trains Robodog for Lunar exploration

NASA is training a quadruped robot named "Spirit" to navigate the challenging lunar landscape as part of the Legged Autonomous Surface Science in Analog...

Saudi Arabia $40b AI fund

Related articles

Top Business News Stories of the Day 14th March 2024

Here are the top 20 business news highlights for today: Ulta CEO emphasizes the need for e-commerce sites...

Marilyn Monroe AI debut

More than 60 years after her death, a realistic AI-generated version of Marilyn Monroe made her debut at...

Oscars 2024 highlights

The 96th Academy Awards ceremony, held on March 10, 2024, dazzled audiences with its array of unforgettable moments...

Women’s Progress in the C-Suite: Challenges, Opportunities, and Future Goals

The composition of leadership within the C-suite has been a subject of scrutiny and discussion for decades, particularly...