Quick Summary
The New Tax Regime for the financial year 2024-25 offers more than 40 deductions and exemptions. Let's check what those are-
- Standard Deduction - Rs 75,000 for Salaried or Pensioner.
- Basic Exemption Limit - Up to 3 Lakh No Tax
- Rebate 87A - T.I. Rs 7 Lakh - Tax Rebate Rs 25,000
- Family Pension - Maximum Rs 25000 for the Pensioner.
- 30% Ad Hoc Standard deduction on Rent Income (Let-out).
- No limit for interest paid on Home Loan up to Rent Income (Let-out) (cannot be carried forward).
- Employer Contribution 80CCD(2) - Limit 14% of Salary (Basis + DA).
- Travelling Allowance - Cost of Travel on Tour or Transfer is exempted.
- Daily Allowance - Daily Charges Incurred for Tour.
- Conveyance Allowance - Actual Expenditure for office purposes.
- Transport Allowance - Only for a disabled Person up to Rs 3,200 Per Month.
- Gratuity - Exempt Rs 20 Lakh for other than government and for Government 100% Exempted.
- Leave Encashment - Exempt Rs 25 Lakh (Govt - 100% Exempt).
- Voluntary Retirement - Exempt upto Rs 5 Lakh (once in a lifetime).
- PPF Interest and Maturity is exempted.
- LIC Maturity is exempt but the premium must not be more than 10% of the sum.
- Sukanya Samridhi Yojana Interest & Maturity is Exempt.
- Agriculture Income is Exempt.
- Interest from Tax-Free Bonds - Fully Exempt.
- Gift from Relatives - Spouse, Mother, Father etc. are Fully Exempt (no limit in bank transfer but below 2 Lakh limit in cash received).
- Gift from All Non-Relatives - up to Rs 50,000 No Tax.
- Gift from Non-Relatives - On Marriage Occasion - Fully Tax Free (no limit in bank transfer but below 2 Lakh limit in cash received).
- Gift Received from Local Authority, Registered Trust/Institution.
- Gift made in Contemplation of the Donor's Death are fully Exempt.
- Property received under a will or inheritance is exempted.
- 80CCH Contribution to Agniveer Corpus Fund - fully Exempt.
- 80JJAA Additional Employee Cost - Deductible.
- LTCG u/s 112A Equity Shares or Mutual Funds - Exempt Up to Rs 1,25,000
- Marginal Relief available.
- Capital Gain Exempt u/s 54, 54B, 54D, 54EC, 54F, 54G, 54GA
- Indexation Benefit in Case Sale of Property, i.e., Long Term Capital Gain.
- Post Office Saving Interest 10(15)(i) - Exempt up to Rs 3,500
- Non-Taxable Perks - Official Purpose - Laptop, Medical Facility, Interest-Free Salary Loan.
- Depreciation Allowed u/s 32.
- Presumptive Taxation Benefits u/s 44AD/44ADA/44AE.
- Disaster Compensation - Exempt u/s 10(10BC) - Central Government/State Government/Local Authority.
- Provident Fund Received - Statutory u/s 10(11) / Recognized u/s 10(12) - Exempt.
- Approved Superannuation Fund - Exempt u/s 10(13).
- Scholarships granted to meet the cost of education - Exempt u/s 10(16).
- Award Instituted by Government - Exempt u/s 10(17A).
- Pension Received by Winner of "Param Vir Chakra", "Maha Vir Chakra", "Vir Chakra" or such other gallantry award - Exempt u/s 10(18).
- Defence Medical Disability Pension - Exempt u/s 10(18).
- Armed Forces Family Pension in case of Death during Operational Duty - Exempt u/s 10(19).
- Commuted/Lumpsum Pension - Fully Exempt Govt. Employees: 1/3 or 1/2 Exempt Non-Govt. Employee.
Overall, the New Regime is not entirely "no-exemption" based, but taxpayers can strategically use these 45 deductions or exemptions for significant tax savings, while also enjoying simpler slab rates.
Under the New Tax Regime for FY 24-25, salaried individuals and pensioners can claim a standard deduction of Rs 75,000.
Yes, individuals with taxable income up to Rs 7 Lakhs are eligible for a tax rebate of Rs 25,000 under the New Tax Regime for FY 24-25.
Exemptions are available for PPF interest and maturity, LIC maturity (provided premium is not more than 10% of the sum assured), and Sukanya Samridhi Yojana interest and maturity.
Gifts from relatives such as spouse and parents are fully exempt with no limit for bank transfers, but cash gifts are limited to Rs 2 Lakhs. Gifts from non-relatives are exempt up to Rs 50,000.
Exemptions are available for Long Term Capital Gains (LTCG) on equity shares and mutual funds up to Rs 1,25,000 under Section 112A, with marginal relief. Further exemptions under Sections 54, 54B, 54D, 54EC, 54F, 54G, and 54GA are also applicable for capital gains from property.
Yes, pensions received by winners of gallantry awards like 'Param Vir Chakra' and defence medical disability pensions are exempt. Armed Forces family pensions in case of death during operational duty are also exempt.
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