Budget 2023: If you are a tax payer then keep these things in mind, know what is new for you in 8 points

To give relief to the middle class, the Finance Minister has further reduced the income tax rates under the new regime and has allowed a standard deduction of 50,000.

India

oi-Sushil Kumar

Published: Thursday, February 2, 2023, 19:22 [IST]

Budget 2023:
Union Finance Minister Nirmala Sitharaman presented the general budget in Parliament on Wednesday. In this budget, he made every possible effort to woo the middle class, especially the tax payers. Now those earning Rs 7 lakh per year will not have to pay tax. Attracted the taxpayers towards the new income tax regime introduced in 2020-21, in which several concessions were given under this scheme while keeping the old tax regime unchanged.

1. To give relief to the middle class, the Finance Minister has further reduced the income tax rates under the new regime and has allowed a standard deduction of 50,000. Taxpayers should note that the new regime will now be a default option unless they opt for the old tax regime.

2. At present, those earning up to 5 lakhs do not pay any tax, now it has been increased to 7 lakhs. Now this exemption will be available to those earning up to 7 lakhs under the new tax system. Under the new regime, there will be no tax on income up to Rs 7.5 lakh for salaried individuals, with a standard deduction of Rs 50,000 available on salary income.

3. Surcharge has been reduced from 37% to 25% for taxpayers with taxable income above 5 crores under the new tax regime. The highest tax rate for such taxpayers will now be 39% instead of 42.7% now.

4. The tax exemption limit on leave encashment received by non-government employees has been raised to Rs.25 lakh from the existing limit of Rs.3 lakh.

5. No capital gains tax will be charged on conversion of gold into electronic gold receipt. This will encourage investment in the electronic form of gold.

6. Long-term capital gains arising from the sale of a property are exempt from tax, if the capital gains or sale proceeds are reinvested in a new residential house.

7. Sum received under a life insurance policy (including bonus on such policy) is exempt from tax if the premium amount does not exceed 10% of the actual capital sum assured in any year. This tax exemption will no longer be available where the total annual premium paid by the individual for life insurance policies issued on or after April 1, 2023, exceeds Rs 5 lakh.

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