In a major middle class alleviation, the Minister of Finance Nirmala Sitharaman announced on Saturday in the Union 2025 budget that people with an annual income of up to Rs 12 Lakh will no longer have to pay tax On income – provided they opt for the new tax on the new tax. diet. This significant revision, which is part of the government’s efforts to facilitate the tax burden of employees, marks a strong increase compared to the tax threshold in tax of 7 Lakh.
How does this advantage work?
The Ministry of Finance specified that this tax liabilities no one applies by virtue of the new tax regime, which has been the defect since 2023. To benefit from the advantage, individuals must simply produce their tax return (ITR ) – No additional step is required.
Previously, a winning individual RS 12 Lakh per year would have paid around 80,000 rupees in terms of income tax under the new regime. With the revised slabs, this tax burden is now reduced to zero, provided that the taxpayer deposits an ITR to claim the delivery.
Who takes advantage of this change?
The government believes that around a taxpayer crore, which paid taxes ranging from Rs 20,000 to 80,000 rupees earlier, will now benefit from zero tax liability until Rs 12 Lakh. This change should benefit a large part of the employees of the middle class, which facilitates financial stress in the middle of the increase in life costs.
Standard deduction boost
The budget also retains the standard deduction of 75,000 rupees as part of the new diet. This means that employees with gross income can go up to Rs 12.75 Lakh (before applying the standard deduction) will be effectively in the tax deductible. In simpler terms, if your income before the deductions is Rs 12.75 Lakh, you will always be eligible for the zero tax after taking into account the standard deduction.
Main to remember
Income up to Rs 12 Lakh: no tax payable as part of the new regime
Standard deduction: RS 75,000, pushing the effective limit in tax franchise to Rs 12.75 Lakh for salaried taxpayers
ITR file: compulsory to claim the discount – no additional paperwork required
Impact: approximately one of taxpayers will now save between 20,000 RS and 80,000 rupees per year
Since the 2024-25 evaluation year, around 8.75 crores of individuals have deposited their itr. All those who opt for the new tax regime will benefit directly from this revision, making the 2025 budget for a central moment for taxpayers in the middle class of India.
