If some one has income of just 5 lakhs gross income (retired / no property income/no stocks/bonds etc - only income is FD interest) , the 5 lakh IT threshhold is automatic (like 2.5 lakhs now) or only with rebates which we have to claim under sub sections like 87C investments ?
Eligibility to Claim Rebate Under Section 87A FY 2019-20 (AY 2020-21)
You can claim tax rebate under this provision if you meet the following conditions:
You must be a RESIDENT INDIVIDUAL; and
Your Total Income, less Deductions, (under Section 80) is equal to or less than Rs 5 lakhs.
The rebate is limited to Rs 12,500. This means that if the total tax payable is lower than Rs 12,500, then that amount will be the rebate under section 87A. This rebate is applied to the total tax before adding the Education Cess (4%).
If your Net taxable income doesn't exceed Rs.5 lakhs, then you will be eligible for a rebate upto 100% of your tax payable under section 87A. However if your Net taxable income EXCEEDS Rs.5 lakhs then rate of income tax shall apply as before.