April 1st marks the commencement of a fresh financial year, ushering in the implementation of Union Budget proposals related to income tax, as announced by Finance Minister Nirmala Sitharaman during her Budget speech in February. Here's an overview of the alterations in tax regulations that will take effect from April 1:
A default transition to the new tax regime is established to streamline tax filing procedures and encourage broader adoption of the updated system. However, taxpayers retain the option to adhere to the previous tax regime if it proves more advantageous for them.
The revised tax slabs are as follows: Income ranging from 3 lakh to 6 lakh will incur a 5% tax, 6 lakh to 9 lakh will be taxed at 10%, 9 lakh to 12 lakh at 15%, 12 lakh to 15 lakh at 20%, and income exceeding ₹15 lakh will be taxed at 30%.
The standard deduction of ₹50,000, previously applicable only to the old tax regime, is now integrated into the new tax framework. This adjustment serves to further reduce taxable income under the updated regime.
The surcharge rate, which previously stood at 37% for incomes exceeding 5 crore, has been decreased to 25%. Maturity proceeds from life insurance policies issued on or after April 1, 2023, where the total premium surpasses ₹5 lakh, will now be subject to taxation.
The tax exemption threshold for leave encashment, applicable to non-government employees, has been raised from ₹3 lakh to ₹25 lakh.
to non-government employees, has been raised from ₹3 lakh to ₹25 lakh.
