Income tax calculator: After ushering in new financial year from 1st April 2023, new income tax regime has become a by default tax regime for taxpayers. However, an earning individual will have the option to opt old income tax regime. From today, standard deduction of ₹50,000 per annum has also been extended in new income tax regime. However, the most important change taking place from today is new income tax slab for FY 2023-24, which has become effective with the beginning of new financial year.
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In this new income tax slab, irrespective of the new or old tax regime, no income tax is payable on an annual income of up to ₹3 lakh as ₹50,000 per annual standard deduction has been extended to new income tax regime as well. On an annual income of ₹3,00,001 to ₹6 lakh, 5 per cent income tax will be payable in current fiscal. On income of ₹6,00,001 to ₹9 lakh in FY24, an income taxpayer will have to pay 10 per cent income tax. On an annual income of ₹9,00,001 to ₹12 lakh, 15 per cent income tax will be levied in the financial year 2023-24. On income of ₹12,00,001 to ₹15 lakh in single financial year, 20 per cent income tax will be levied on the taxpayer. On income above ₹15 lakh per annum, 30 per cent income tax will be levied on the taxpayer under new income tax slab effective from 1st April 2023.
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However, the new income tax slab will be applicable for only those taxpayers who opt for the new income tax regime while filing their income tax return (ITR).
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Zero income tax on ₹7 lakh or below income
Income tax rebate under Section 87A of the income tax act has also been extended to new income tax regime in FY24. So, this benefit is now available to all those taxpayers who don’t opt old tax regime during ITR filing.
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Elaborating upon the benefit of this income tax rebate, Pankaj Mathpal, MD & CEO at Optima Money Managers said,, “Under Section 87A of the income tax act, a maximum rebate of ₹25,000 per in one financial year has been now extended to new income tax regime from FY24. This means, a person earning ₹7 lakh or below in FY24 won’t need to pay any income tax as he can claim ₹15,000 income tax rebate on ₹3,00,001 to ₹6 lakh income tax slab and ₹10,000 rebate on ₹6,00,001 to ₹7 lakh income tax slab.”
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Tax on debt mutual funds
Asking debt mutual fund investors to keep a tab on one’s income tax slab after gains in debt mutual fund investment, SEBI registered tax and investment expert Jitendra Solanki said, “From 1st April 2023, income from debt mutual fund investments would be considers short term capital gain taxable at income tax slab rates.”
