DelhiDesk The late Arun Jaitley presented his first Union Budget after winning an overwhelming mandate in the Lok Sabha elections. The budget raised the personal income tax exemption limit and increased the limit for deduction under Section 80C. The deduction limit on health insurance premiums was also raised, and the transport allowance exemption was increased. Wealth tax was abolished, and an additional surcharge was introduced on the super-rich who had a taxable income of more than 1 crore. The budget also imposed a 10% income tax on dividends in excess of 10 lakh annually. In 2020, the government introduced new tax slabs, giving taxpayers the choice to either remain in the old regime with exemptions and deductions or opt for the new reduced tax rate without those exemptions. There were also changes in income tax rules effective from 1 April 2023, including changes in income tax slabs and the extension of rebate for annual income up to 7 lakh.
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👉 Arun Jaitley presented his first Union Budget after a mandate in Lok Sabha elections.
👉 Personal income tax exemption limit was raised from 2 lakh to 2.5 lakh.
👉 Exemption limit for senior citizens was increased from 2.5 lakh to 3 lakh.
👉 Deduction limit under Section 80C was increased to Rs1.5 lakh from 1 lakh.
👉 Deduction limits for interest on home loan were increased to 2 lakh from 1.5 lakh.
👉 Deduction limit on health insurance premiums was raised from 15,000 to 25,000 for the general public.
👉 Deduction limit on health insurance premiums was increased to 30,000 20,000 for senior citizens.
👉 Transport allowance exemption was increased from 800 to 1,600 per month.
👉 Additional deduction of 50,000 for contribution under the National Pension Scheme (NPS) under Section 80 CCD.
👉 Surcharge for income above 1 crore was increased to 12% from 10%.
👉 Wealth tax was abolished.
👉 Additional surcharge of 2% on super-rich who had taxable income of more than 1 crore.
👉 Tax rebate was raised from 2,000 to 5,000 for those with income not exceeding 5 lakh per annum under section 87A.
👉 Limit of deduction on rent paid under section 80GG was raised from 24,000 per year to 60,000 per annum.
👉 Surcharge for income above 1 crore was increased to 15% from 12%.
👉 Introduced a 10% income tax on dividends in excess of 10 lakh annually.
👉 Tax rate was reduced from 10% to 5% in the 2.5 lakh – 5 lakh bracket.
👉 Surcharge of 10% was introduced on those with annual taxable income between 50 lakh 1 crore.
👉 Standard deduction of 40,000 in lieu of current exemption in transport allowance and reimbursement of miscellaneous medical expenses.
👉 Deduction for medical expenditure was raised to 50,000 30,000 for senior citizens.
👉 Deduction for interest income earned on deposits with banks and post offices was increased to 50,000 10,000 in the case of senior citizens along with an exemption from the deduction for tax for interest income up to 50,000.
👉 Taxation of long-term capital gains exceeding 1 lakh at the rate of 10% without allowing the benefit of any indexation.
👉 In the interim budget, those earning less than 5 lakh paid zero tax.
👉 Standard deduction was increased to 50,000 40,000 for the salaried class.
👉 New tax slabs were announced in Budget 2020.
👉 Dividends received from mutual funds and domestic companies are to be taxed at the recipient’s hands.
👉 If the employer’s contribution exceeds 7.5 lakh in a year towards NPS, superannuation fund, and EPF, it will be taxable in the hands of the employee.
👉 Changes in income tax rules effective 1 April 2023 including changes in income tax slabs and tax rebate limit raised.
👉 Extension of rebate for annual income up to 7 lakh, applicable to people under the new income tax regime.
👉 Standard deduction of 50,000 has been introduced under the new income tax slab.
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