The following are the key announcements in Budget 2025:
·SLAB RATE OF INDIVIDUALS:-
Tax relief: No income tax up to ₹12 lakh. Other than special rate income like capital gains, there will be no tax payable for taxpayers earning up to ₹12 lakh per annum under the new tax regime. This move of “No income tax” up to ₹12 lakh annually aligns with the nation’s vision of helping India’s middle-class and low-income groups.
The new tax rates are as follows :-
SLABS | TAX RATES |
0-4 lakh | NIL |
4-8 lakh | 5% |
8-12 lakh | 10% |
12-16 lakh | 15% |
16-20 lakh | 20% |
20-24 lakh | 25% |
Above 24 lakhs | 30% |
· Changes in TDS/TCS:-
Further there are some key changes to the Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) in the Budget 2025. The government aims to simplify tax deduction and collection at source. The number of TDS rates and thresholds will be reduced for better compliance.
- TDS Changes
S.no | Section | New Limit | Old Limit |
1. | 193 | ₹10,000 | NIL |
2. | 194A – Interest other than interest on securities | (i) ₹1,00,000/- for senior citizen (ii) ₹50,000/- for others when payer is bank, cooperative society, and post office, (iii) ₹10,000/-in other cases | (i) ₹50,000/- for senior citizen (ii) ₹40,000/- for others when payer is bank, cooperative society, and post office (iii) ₹5,000/- in other cases |
3. | 194 – Dividend for an individual shareholder | ₹10,000/- | ₹5,000/- |
4. | 194K – Income in respect of units of a mutual fund or specified company/undertaking | ₹10,000/- | ₹5,000/- |
5. | 194B – Winnings from lottery,crossword,puzzle, etc. | ₹10,000/- in respect of a single transaction | Aggregate of amounts exceeding ₹10,000/- during the financial year |
6. | 194BB- Winnings from horse race | ₹10,000/- in respect of a single transaction | Aggregate of amounts exceeding ₹10,000/- during the financial year |
7. | 194D – Insurance commission | ₹20,000/- | ₹15,000/- |
8. | 194G – Income by way of commission, prize, etc., on lottery tickets | ₹20,000/- | ₹15,000/- |
9. | 194H – Commission or brokerage | ₹20,000/- | ₹15,000/- |
10. | 14-I Rent | ₹50,000/- per month or part of a month or ₹6,00,000/- in aggregate during the financial year. | ₹2,40,000/- during the financial year |
11. | 194J – Fee for professional or technical services | ₹50,000/- | ₹30,000/- |
12. | 194LA – Income by way of enhanced compensation | ₹5,00,000/- | ₹2,50,000/- |
- TCS Changes
S.no | Section | New Limit | Old Limit |
1. | 206C(1G) – LRS Scheme | 10,00,000 | 7,00,000 |
2. | 206C(1G) – Remittances for education purposes, where such remittance is out of a loan taken from a specified financial institution. | Exempt | 7,00,000 |
3. | 206C(1H) – TCS on Purchase of Goods | Exempt | 50,00,000 |
·Changes in Deduction:-
Deduction u/s 80CCD for contributions made to the NPS Vatsalya.It is proposed to extend the tax benefits available to the National Pension Scheme (NPS) under sub-section (1B) of section 80CCD of the Income-tax Act, 1961 to the contributions made to the NPS Vatsalya accounts, as applicable.
·Extended Time Limit to File Updated Return:-
The time limit to file updated return has been extended to 4 years from 2 years. This extension of the updated tax return filing window to four years offers greater flexibility to taxpayers to rectify or revise their filings.
·Rebate under section 87A:-
According to the Budget Memorandum, the income limit for rebate under Section 87A has been increased from ₹7,00,000 to ₹12,00,000 for taxpayers under Section 115BAC(1A). Additionally, the rebate amount under clause (a) of the first proviso to Section 87A has been raised from ₹25,000 to ₹60,000.
“In-Depth Analysis of Union Budget 2025 by CA Neha Aggarwal, Partner at C.P. Agrawal & Associates”
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