New Tax Regime 2025

New Tax Regime

🚨 BIG UPDATE: New Tax Regime Gets a Makeover! 🚨

The government has revised the New Tax Regime to make it more attractive 🎉. Here’s what’s changing:

✅ No Tax: Income up to ₹12,00,000 is now tax-free 🚀💰

✅ Standard Deduction: ₹75,000 🏦✨

📊 New Income Tax Slabs under the New Tax Regime:

🟢 Nil Tax: ₹0 to ₹4,00,000 🆓

🟡 5% Tax: ₹4,00,001 to ₹8,00,000 💸

🟠 10% Tax: ₹8,00,001 to ₹12,00,000 📈

🔴 15% Tax: ₹12,00,001 to ₹16,00,000 🏡

🔵 20% Tax: ₹16,00,001 to ₹20,00,000 💼

🟣 25% Tax: ₹20,00,001 to ₹24,00,000 🏦

⚫ 30% Tax: Above ₹24,00,000 🚨

💰 Special Tax Rates Apply To:

📈 Mutual Fund Returns

📊 Stock Market Gains

🎟️ Lottery Winnings

Here are the special tax rates applicable under the New Tax Regime:

📌 Stock Market & Mutual Funds:

✅ Equity LTCG (Long-Term Capital Gains) Tax: 12.5% (if gains exceed ₹1.25 lakh) 📈

✅ Equity STCG (Short-Term Capital Gains) Tax: 20% 💹

✅ Debt Mutual Funds (LTCG & STCG): As per the income tax slab 🚀

📌 Dividend Income:

✅ Dividends from stocks & mutual funds: Taxable as per the income tax slab 🏦

📌 Other Special Taxes:

✅ Lottery, Game Show Winnings, Betting, Gambling, Horse Racing: Flat 30% (plus surcharge & cess) 🎰🎟️

Marginal Relief in Income Tax

🔥 Marginal Relief in the New Tax Regime – Big Savings! 🔥

Let’s see how it works 👇

💼 If your gross salary is ₹12.76 lakh (₹12.01 lakh after ₹75K standard deduction), your tax without relief would be ₹60,150 😨.

⚡ But with Marginal Relief, you pay only ₹1,000! (Just the tax on the additional income earned) 🛡️💰

📌 Important Note 👇

🧾 You also need to add 4% Cess

🔹 On ₹1,000 tax, 4% Cess = ₹40

🔹 Total Tax Liability = ₹1,040 ✅

✨ This relief applies up to a gross salary of ₹13,45,588 (i.e. ₹12,70,588 taxable salary after standard deduction). Beyond this, full tax applies as per slab.

💡 Why ₹13,45,588 as the threshold?

📊 At this taxable salary:

✅ If tax is calculated only on the additional income earned, it comes out to be ₹70,588.

✅ If tax is computed using slab rates, it also totals ₹70,588.

📢 That’s why Marginal Relief applies only till ₹13,45,588! After this, the regular slab rates take over 📉.

😮‍💨 Marginal relief ensures that no one is unfairly taxed just because their salary slightly exceeds the tax-free limit. A win for fairness! 💯✨

Old Tax Regime

🔵 Section 80C:

Investments in Provident Funds such as EPF, PPF, etc., payments made towards life insurance premiums, Equity Linked Saving Schemes, payments made towards the principal sum of a home loan, SSY, NSC, SCSS, etc.

🔵 Section 80D:

This is the deduction for Mediclaim or Medical Insurance. The limit for Section 80D is as follows:

- If taken for Self and Family = Rs. 25,000 ; And

- If taken for Parents also = Rs. 25,000

Therefore, the total deduction under this section could be Rs. 50,000/-

Please note that, if a person is a Senior Citizen, then Rs. 50,000 shall be allowed (for either category) instead of Rs. 25,000.

🔵 Section 80CCD(1B):

Deduction for Additional Contribution to NPS by Employee. Investments in NPS are outside the Rs 1,50,000 limit under Section 80CCE. Therefore, an additional deduction of Rs. 50,000 can be claimed.

🔵 Section 80CCD(2):

This is the deduction for Employer contribution to NPS. This deduction is limited to 10% of Salary (14% in the case of Govt. employees).

🔵 Section 10(13A):

This exemption is for House Rent Allowance. An assessee can claim the exemption against the rent payment. The limit shall be as follows:

- Actual HRA

- 40% of Basic (50% in case of Metro Cities)

- Rent Paid (-) 10% of Basic

THE LEAST OF THE ABOVE 3 SHALL BE ALLOWED AS AN EXEMPTION.

🔵 Section 24(b):

This deduction is for the House Loan Interest Amount which is limited to up to Rs. 2,00,000

🔵 Section 80E:

This deduction is for Interest on Education Loan. This entire interest on an education loan is allowed in 8 consecutive years. Therefore, 1/8th of the Total Interest Amount can be claimed as deductions every year.

🔵 Section 80EEB:

Deduction for Interest on Electric Vehicle Loan is allowed under this section for Rs. 1,50,000.

🔵 Section 10(5): Leave Travel Allowance (LTA)

LTA is a type of allowance given by an employer to their employee for travelling to any place in India either on leave, after retirement or after the termination of his service.

LTA Exemption is allowed for any 2 Journeys in a Block of 4 Years. It is allowed only for Domestic Journey and Actual Journey is mandatory to claim this exemption.

It can be claimed for Self, Spouse, Children, Dependent Parents, Brother, or Sister.

Maximum Amount of Deductions:

———————————————-

Actual Amount Spent on Travel OR LTA Amount Provided by the employer; whichever is lower shall be allowed as a deduction.

🔵 Section 80DD: Maintenance/Medical Treatment of Disable Dependant Person:

This is a Flat Deduction which is allowed for the medical exp. or treatment of Disable Dependant Person.

- If the disability is from 40% to 79% = Rs. 75,000 Deduction can be claimed.

- If disability is 80% or more = Rs. 1,25,000 Deduction can be claimed.

🔵 Section 80DDB: Medical Treatment of Specified Diseases

Max. Deduction amount shall be Rs. 40,000/-. ( For Senior Citizen = upto Rs. 1 Lac)

🔵 Section 80G: Donation

If a Donation is given to 100% Eligible Trusts = Then the Entire amount of the donation can be claimed as an exemption.

If Donation is given to 50% Eligible Trusts = Then deduction shall be limited to 10% of Adjusted total income.

🔵 Section 80GG: Deduction for Rent Payment (When HRA not Received)

If HRA is not received/claimed by the assessee, but rent payment is being made, then a deduction u/s 80GG can be claimed.

Maximum Amount of Deductions:

————————————————--

- Rs. 5,000 Per Month; OR

- 25% of Total Income; OR

- Rent Paid (-) 10% of Total Income

LEAST OF THE ABOVE 3 LIMITS shall be allowed as a deduction.

🔵 Section 80GGC: Donation to Political Parties or Electoral Trusts

100% of the donation amount shall be allowed.