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Uncover essential income tax rules for salaried individuals FY 2024-25. Get insights on exemptions, deductions, and choosing the right tax regime to maximize your savings.
01-04-2024

Essential Income Tax Rules for Salaried Individuals FY 2024-25: Simplify Your Tax Planning

Income Tax Rules for Salaried Individuals FY 2024-25: As we step into the financial year 2024-25, understanding the income tax rules is paramount for salaried individuals. With no new changes announced in the tax laws for this fiscal year, the continuation of previous rules means planning your taxes effectively remains as crucial as ever. Here’s a guide on what salaried employees need to know to navigate the fiscal year with confidence and strategic insight.

Income Tax Rules for Salaried Individuals FY 2024-25: Choose Between Old and New Tax Regimes

The first step in your tax planning journey is deciding between the old and new tax regimes for the calculation of your tax deducted at source (TDS) on salary. The new tax regime is the default option; however, if you prefer the old regime’s benefits, you must communicate this choice to your employer promptly.

Income Tax Rules for Salaried Individuals FY 2024-25: Understanding the Basic Exemption Limits

The basic exemption limit varies between the two tax regimes. In the new tax regime, an income up to Rs 3 lakh is exempt from tax for individuals of all ages. Conversely, the old tax regime’s exemption limit is age-dependent, starting from Rs 2.5 lakh for individuals below 60 years and going up to Rs 5 lakh for super senior citizens aged 80 and above.

Income Tax Rules for Salaried Individuals FY 2024-25: Zero Tax Payable Under Both Regimes

Both tax regimes offer a tax rebate under Section 87A, allowing for zero tax on net taxable incomes below a certain threshold. The new tax regime provides a higher rebate, enabling zero tax payable for incomes up to Rs 7 lakh, compared to the Rs 5 lakh limit under the old regime.

Income Tax Rules for Salaried Individuals FY 2024-25: Deductions and Exemptions

While both tax regimes offer deductions, the old tax regime is more generous, offering various exemptions on investments, health insurance premiums, and more. The new regime simplifies deductions but limits them to a standard deduction from salary and pension income and a deduction for employer contributions to the NPS account.

Filing ITR on Time

To benefit from the old tax regime while filing your income tax return (ITR), ensure you file before the July 31 deadline. Filing your ITR on time allows you to opt for the old regime, as the new regime is the default option. If you’re looking to file your income tax return seamlessly and efficiently, Techmin Consulting provides a straightforward and reliable service. Begin your tax filing process with us.

Reduced Surcharge in New Tax Regime

For high-income earners, the new tax regime offers a reduced surcharge rate of 25% for incomes over Rs 5 crore, compared to the 37% surcharge applicable in the old regime. This can lead to significant tax savings for those with higher incomes.

Navigating Tax Planning with These Rules

Understanding these rules is the first step towards efficient tax planning. To further optimize your tax savings, consider the following strategies:

  • Invest Wisely: Take advantage of the deductions under Section 80C by investing in eligible instruments. This can reduce your taxable income and, consequently, your tax liability.
  • Insurance Policies: Premiums paid for health insurance policies can offer dual benefits of health coverage and tax savings under Section 80D. Securing your family’s future is paramount. With Techmin Consulting, you can find the LIC policy that best suits your financial goals and provides the security your loved ones deserve. Explore your options with us and ensure your family’s well-being.
  • Home Loan Benefits: If you have a home loan, the interest paid on it can further reduce your taxable income under Section 24 and Section 80C. Embarking on the journey of financial year planning with a dream of home ownership in mind? Techmin Consulting streamlines the home loan application process, making it easier for you to navigate the complexities of financial planning with confidence. Start your application process with us today and take a step closer to your dream home.

Conclusion

With the financial year 2024-25 already underway, being well-versed with these income tax rules is essential for every salaried individual. By choosing the right tax regime and making the most of the available deductions and exemptions, you can significantly reduce your tax liability. Remember, the key to effective tax planning is understanding these rules and acting promptly. Happy financial planning!

Disclaimer: The views and recommendations made above are those of individual analysts, and not of Techmin Consulting. We advise investors to check with certified experts before taking any investment decisions.

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