Changes in Income Tax Slabs
Under the new tax regime, there have been changes in the income tax slabs, allowing people to save up to Rs 17,500 in taxes each year.
Be sure to refer to the updated slabs when filing your Income Tax Return (ITR).
Increased Standard Deduction
The government has raised the standard deduction limit for employed individuals. Previously, it was Rs 50,000, but it has now increased to Rs 75,000.
For family pensioners, the limit has been increased from Rs 15,000 to Rs 25,000.
Higher Deduction Under Corporate NPS
The deduction limit under the corporate NPS has also been raised. Before, companies could contribute up to 10% of the employee’s salary to their NPS account, but now the limit has been increased to 14%.
Changes in Capital Gains Tax
There are new tax rates for both short-term and long-term capital gains:
1) Short-term capital gains from equity and mutual funds will now be taxed at 20% (previously 15%).
2) Short-term capital gains from assets like gold or property will be taxed according to the income tax slab.
3) Long-term capital gains from assets will be taxed at 12.5%, an increase from the previous 10%.
4) The tax exemption limit for long-term capital gains has been raised from Rs 1 lakh to Rs 1.25 lakh.
Holding Period for Capital Gains
New rules for capital gains based on holding periods have been introduced:
1) For listed securities, if the holding period is more than 12 months, it will be considered long-term; otherwise, it will be short-term.
2) For non-listed securities, a holding period of more than 24 months is required for long-term capital gains.
