The main reason for this is a big announcement made by the government in the Union Budget 2025. The government had said in the budget presented in February this year that taxpayers with income up to Rs 12 lakh will not have to pay tax. The government had also made changes in the tax slabs of the new regime. Many taxpayers feel that this change has come into effect with immediate effect. But, it is wrong to think so.

Tax exemption rule up to Rs 12 lakh from FY26

The truth is that the rule of exemption from tax on income up to Rs 12 lakh per annum is applicable from the financial year 2025-26. This means that this decision will not be applicable on income earned from April 1, 2024 to March 31, 2025. This year taxpayers will not get the benefit of this tax benefit in filing returns. If you are going to file income tax return, then the old rules of income tax will apply. Chartered Accountant Balwant Jain said, “Taxpayers should look at the benefits of both the new and old regime before filing the return. For those taxpayers whose HRA component is high, the old regime is more beneficial.”

Benefits of deduction in FY25 returns

Taxpayers can avail the benefits of many deductions and exemptions while filing FY25 returns. Especially if a taxpayer has made tax saving investments during FY25, then he can claim deduction. Under Section 80C, deduction of up to Rs 1.5 lakh can be claimed from tax saving investments in a financial year. Apart from this, deduction can also be claimed on health insurance under Section 80D and home loan interest under Section 24B. Taxpayers living in rented houses can claim HRA. Also, by claiming standard deduction of Rs 50,000, the total deduction can exceed Rs 3-4 lakh.

Old regime is more beneficial for some taxpayers

According to Neeraj Aggarwal, partner, Nangia & Co LLP, the old income tax regime is more beneficial for taxpayers with certain income levels. He said, “Taxpayers can claim deduction of Rs 1.5 lakh under section 80C, deduction up to Rs 75,000 under section 80D, deduction under HRA, deduction on home loan interest and deduction on education loan in the old regime.”

Before filing returns, see which regime is more beneficial

He said that if the annual income of a taxpayer is Rs 15 lakh, then he will benefit from the old regime only if he claims a deduction of about Rs 4 lakh. If the annual income of a taxpayer is Rs 20 lakh, then the old regime will be beneficial only if he claims a deduction of up to Rs 4.5 lakh. This means that now select the default tax regime i.e. the new regime of income tax only after tax calculation. Taxpayers will get the benefit of the new regime when filing returns next year.

The post ITR: Tax-Free Income Up to ₹12 Lakh – New Regime Explained in Simple Terms first appeared on Rightsofemployees.com.

Its purpose is to provide guaranteed returns to the investor with tax benefits under Section 80C of the Income Tax Act, 1961. Any person can open a PPF account in a post office or bank with a minimum investment of Rs 500. If you want, you can also open a PPF account in the name of your wife. Let us understand how any investor can get a tax free income of Rs 1,06,828 every month from PPF?

What is PPF?

PPF is a retirement focused scheme that offers guaranteed returns and tax benefits under Section 80C of the Income Tax Act, 1961. Anyone can invest in this small saving scheme. Salaried class and business people can invest in it. Under this, you can invest a minimum of Rs 500 and a maximum of Rs 1.5 lakh in a financial year.

What is the maturity period of PPF?

The initial lock-in period of PPF is 15 years. After 15 years, account holders can extend their account for unlimited blocks of 5 years each. Any PPF account holder can withdraw the account once during a financial year after five years. In case of need of money, you can withdraw 50 percent of the remaining amount on credit at the end of the fourth year or at the end of the previous year, whichever is less. That is, in 2023-24, up to 50% of the remaining amount can be withdrawn till 31.03.2023 or 31.03.2024, whichever is less.

How to get Rs 1.06 lakh every month?

To get Rs 1,06,828 every month from PPF, one has to start investing Rs 1.50 lakh in every financial year and continue it till the maturity period of 15 years. To get maximum benefit of interest, investment should be made between April 1 and April 5 in every financial year. This investment should be of Rs 1.5 lakh in lump sum.

Maturity after 15 years

If you invest Rs 1.5 lakh every year, then in 15 years you invest a total of Rs 22.50 lakh. During this time, you will get interest of about Rs 18.18 lakh on the money. According to this, the maturity amount will be Rs 40,68,209. Investors can take a five-year extension on this and can continue investing Rs 1.50 lakh every year as before.

Maturity after 20 and 25 years

In 20 years, the investment amount will increase to Rs 30,00,000 and interest of Rs 36,58,288 will be received on it. In this way, the maturity amount will be around Rs 66,58,288. Here the investor can take another extension of five years and continue investing Rs 1.5 lakh annually. Similarly, in 25 years, the interest on the investment amount of Rs 37.50 lakh is Rs 65,58,015. The total maturity amount is Rs 1,03,08,015.

What will be the maturity after 29 years?

If you keep investing Rs 1.5 lakh every year in PPF for 29 years, then during this time you will deposit a total of Rs 43.50 lakh. During this time you will get interest of about Rs 99.26 lakh. That is, your maturity amount will be Rs 1 crore 42 lakh 76 thousand 621. Similarly, in 32 years the total investment will increase to Rs 48,00,000 and the interest will be around Rs 1,32,55,534. After 32 years, you will get Rs 1 crore 80 lakh 55 thousand 534 on maturity. You can stop your investment here.

Now you can withdraw the interest earned on this money every month. If you have extended this scheme for more than 15 years, then you can withdraw the interest only once every year. If you deposit the Rs 1 crore 80 lakh received on maturity in the bank and the bank gives you 7.1% interest annually, then you will get an interest of about Rs 15 lakh 4 thousand in a year. If you divide this interest into 12 months, then you will get about Rs 1 lakh 6 thousand every month.

(Disclaimer: All these calculations are based on estimates only. This is not any definite information on the basis of which you should take an investment decision. Consult an expert or your financial advisor before making any kind of investment.)

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The post PPF Interest Rate: You can get tax free income of Rs 106000 every month from Public Provident Fund first appeared on Rightsofemployees.com.

If you earn money in other ways besides salary, then this news is useful for you. This is because generally income tax is levied on every income. This not only includes salary, but apart from salary, it also includes many other things like interest from savings, income from home, side business, capital gains etc. But there are some income sources on which not even a single rupee is taxed. Today we are going to tell you about 10 such incomes, where not even a single rupee is taxed.

There is no tax on this income

Earning from EPF

Income tax exemption is available under Section 80C of the Income Tax Act on the amount deposited by you in the PF account. Tax exemption is also available on the amount deposited by the employer in your EPF account. The condition in this is that this amount should not be more than 12% of your basic salary. If the amount is more than this then you will have to pay income tax on the remaining amount.

Returns up to Rs 1 lakh from share or equity mutual funds

If you have invested in Shares or Equity Mutual Fund, then the return of up to Rs 1 lakh on selling them after one year is tax free. This return is calculated under LTCG. In last year’s budget, LTCG tax has been imposed on returns of more than Rs 1 lakh received from investment in shares or equity mutual funds.

Wedding gifts

If a gift is received from friends or relatives at a wedding, then there is no need to pay tax on it. The condition in this is that you should have received the gift around your wedding. If your wedding is on March 16 and the gift is given after six months, then there will be no income tax exemption on it. Along with this, the value of the gift should not exceed Rs 50,000.

interest on savings account

If you get interest of up to Rs 10,000 in a year from your bank’s savings account, then you get exemption from income tax on it under Section 80TTA of the Income Tax Act. If the interest on savings account is more than Rs 10,000 annually, then you will have to pay income tax on the additional amount.

Profit received from partnership firm

If you are a partner in a firm, then the amount you receive as Share of Profit is free from income tax liability. In fact, your partnership firm already pays tax on it. Income tax exemption is only on the profits of the firm, not on the salary you receive.

Amount received on life insurance claim or maturity

If you have purchased a life insurance policy, then the amount received by you at the time of claiming it or on its maturity is completely free from Income Tax. The condition in this is that the annual premium of your life insurance policy should not exceed 10% of its sum assured.

If the premium in a life insurance policy is more than this, you will have to pay income tax on the additional amount. If you have taken a life insurance policy for someone in your family who is disabled or suffering from a serious illness, then the premium amount can be up to 15% of the sum assured.

Amount received in VRS

Many people take voluntary retirement (VRS) from job. If you have also taken VRS, then the amount received up to Rs 5 lakh is free from Income Tax. This facility is only for employees working in government or PSU (public sector companies), not for people working in the private sector.

inherited property

If you have also inherited property, jewelery or cash from your parents, then you do not have to pay income tax on it. Even if someone had made a will in your name and you have received property or cash from him, you do not have to pay income tax on it. You will have to pay tax on future income or interest income from such property as per your tax slab.

Agricultural income

If you have agricultural land and you are earning from farming or related activities, then you do not have to pay any income tax on that income. Agricultural income also includes its produce, amount received as rent etc. If you do farming by building an agricultural farm, then the income from it is also free from Income Tax.

On feeding and feeding in business

If you are a businessman then you have to meet many types of people during your business. This includes customers, vendors and other employees. The cost of feeding them is also included in the process of business. You should keep a bill for such expenses and present them as business expenses. If you adopt this process then you can save income tax on this amount.

The post Tax Free Income! 10 types of income on which there is no tax, important things to know before filing return first appeared on Rightsofemployees.com.

What will come out of Finance Minister Nirmala Sitharaman’s box for them this time? Will they get exemption from standard deduction? Will the discount on NPS increase? Will NPS be included in the new tax regime? Will the tax exemption limit increase? Will the tax free income limit of Rs 7 lakh be increased? If sources are to be believed, this wish of the taxpayers may be fulfilled. Yes, the limit of tax free income can increase from Rs 7,00,000 to Rs 7,50,000.

Will taxpayers get Modi’s guarantee?

Taxpayers have a guarantee this time from the Modi government. India’s budget is going to be presented tomorrow on 1 February 2024. Taxpayers have many expectations from Finance Minister Nirmala Sitharaman’s interim Budget 2024.

According to sources, Modi government may give some more relief to taxpayers. Currently, in the new tax regime no tax has to be paid up to Rs 7 lakh. Now the government can increase it to Rs 7.50 lakh. At the same time, the government can also give a separate tax slab to women, in which no tax will have to be paid up to Rs 8 lakh.

Budget will be presented tomorrow

Union Finance Minister Nirmala Sitharaman will present the budget (Union Budget 2024) for the sixth time on 1 February 2024. Nirmala Sitharaman is going to present the last budget of the second term of the Modi government because after that Lok Sabha elections are going to be held across the country.

In such a situation, the government can make many announcements about salary classes. The government’s focus is to increase focus on the new tax regime. More and more people have to be connected with it. This time it is expected that the government will announce the new tax and more people will choose it.

The post Tax Free income: Tax free income limit may increase from Rs 7,00,000 to Rs 7,50,000, check details first appeared on Rightsofemployees.com.

Agricultural Income

The most famous category of tax-free income is income from agriculture. Income earned from agricultural activities is free from income tax under Section 10(1) of the Income Tax Act, 1961. The logic behind this exemption is to support and promote the agriculture sector, which plays an important role in the country’s economy. Tax-free agricultural earnings encourage farmers to invest in their farms and improve agricultural methods.

Gifts and Heritage

Gifts received by individuals in India are generally tax-free, provided they satisfy certain conditions laid down in section 56(2) of the Income Tax Act. Similarly, inherited property is not subject to income tax. This exemption has been given because imposing tax on gifts and inheritances will not increase family financial support and will hinder the transfer of money between generations.

Interest on PPF and EPF

Interest earned on investments in Public Provident Fund (PPF) and Employees Provident Fund (EPF) is tax-free. These investments are encouraged because they promote long-term savings and financial security for individuals. The government encourages citizens to contribute to these plans by providing tax exemption on the interest earned.

Profit on long-term investment

Long-term capital gains (LTCG) arising from the sale of certain assets like equity shares and mutual funds are tax-free if they meet certain criteria. The government aims to encourage long-term investment in the capital market by providing this exemption. However, tax has to be paid on short-term capital gains.

HRA (House Rent Allowance)

House Rent Allowance (HRA) is a component of salary that can be tax-free. If the taxpayer fulfills certain conditions given in section 10(13A). The purpose behind this exemption is to reduce the financial burden on people living in rented houses.

It is noteworthy that it is important for taxpayers to understand the categories of tax-free income to customize their financial plan. These rebates are designed to support specific sectors, encourage long-term savings and provide relief in certain circumstances.

The post No tax is imposed on these 5 types of income, Know the tax rules first appeared on Rightsofemployees.com.

Agricultural Income

The most famous category of tax-free income is income from agriculture. Income earned from agricultural activities is free from income tax under Section 10(1) of the Income Tax Act, 1961. The logic behind this exemption is to support and promote the agriculture sector, which plays an important role in the country’s economy. Tax-free agricultural earnings encourage farmers to invest in their farms and improve agricultural methods.

Gifts and Heritage

Gifts received by individuals in India are generally tax-free, provided they satisfy certain conditions laid down in section 56(2) of the Income Tax Act. Similarly, inherited property is not subject to income tax. This exemption has been given because imposing tax on gifts and inheritances will not increase family financial support and will hinder the transfer of money between generations.

Interest on PPF and EPF

Interest earned on investments in Public Provident Fund (PPF) and Employees Provident Fund (EPF) is tax-free. These investments are encouraged because they promote long-term savings and financial security for individuals. The government encourages citizens to contribute to these plans by providing tax exemption on the interest earned.

Profit on long-term investment

Long-term capital gains (LTCG) arising from the sale of certain assets like equity shares and mutual funds are tax-free if they meet certain criteria. The government aims to encourage long-term investment in the capital market by providing this exemption. However, tax has to be paid on short-term capital gains.

HRA (House Rent Allowance)

House Rent Allowance (HRA) is a component of salary that can be tax-free. If the taxpayer fulfills certain conditions given in section 10(13A). The purpose behind this exemption is to reduce the financial burden on people living in rented houses.

It is noteworthy that it is important for taxpayers to understand the categories of tax-free income to customize their financial plan. These rebates are designed to support specific sectors, encourage long-term savings and provide relief in certain circumstances.

The post Tax Free Income: No tax is imposed on these 5 types of income, Know the tax rules first appeared on Rightsofemployees.com.

Agricultural Income

The most famous category of tax-free income is income from agriculture. Income earned from agricultural activities is free from income tax under Section 10(1) of the Income Tax Act, 1961. The logic behind this exemption is to support and promote the agriculture sector, which plays an important role in the country’s economy. Tax-free agricultural earnings encourage farmers to invest in their farms and improve agricultural methods.

Gifts and Heritage

Gifts received by individuals in India are generally tax-free, provided they satisfy certain conditions laid down in section 56(2) of the Income Tax Act. Similarly, inherited property is not subject to income tax. This exemption has been given because imposing tax on gifts and inheritances will not increase family financial support and will hinder the transfer of money between generations.

Interest on PPF and EPF

Interest earned on investments in Public Provident Fund (PPF) and Employees Provident Fund (EPF) is tax-free. These investments are encouraged because they promote long-term savings and financial security for individuals. The government encourages citizens to contribute to these plans by providing tax exemption on the interest earned.

Profit on long-term investment

Long-term capital gains (LTCG) arising from the sale of certain assets like equity shares and mutual funds are tax-free if they meet certain criteria. The government aims to encourage long-term investment in the capital market by providing this exemption. However, tax has to be paid on short-term capital gains.

HRA (House Rent Allowance)

House Rent Allowance (HRA) is a component of salary that can be tax-free. If the taxpayer fulfills certain conditions given in section 10(13A). The purpose behind this exemption is to reduce the financial burden on people living in rented houses.

It is noteworthy that it is important for taxpayers to understand the categories of tax-free income to customize their financial plan. These rebates are designed to support specific sectors, encourage long-term savings and provide relief in certain circumstances.

The post Non Taxable income: No tax is imposed on these 5 types of income, Know the tax rules first appeared on Rightsofemployees.com.

Now under the Finance Bill 2023, tax exemption has also been given on income of more than Rs 7 lakh. For this, amendments have been made in the Finance Bill. Under this, individuals earning income slightly above the tax free income of Rs 7 lakh will have to pay tax only on the additional income.

The Finance Bill 2023 has been approved by the Parliament and it will become effective from 1 April. In this, some relief has been given to taxpayers under the new tax regime through amendment.

The Finance Ministry explained the rules, while clarifying the provision of Finance Bill 2023, the Finance Ministry has said that under the new tax regime, if a taxpayer’s annual income is Rs 7 lakh, then there is no tax liability on him. But if the income becomes Rs 7,00,100, then the tax liability becomes Rs 25,010. That is, due to additional income of only Rs 100, taxpayers have to pay tax of Rs 25,010. In view of this problem of taxpayers, it has been proposed to give minor relief through amendment in Finance Bill 2023.

Taxpayers will get the benefit of small margin

Let us understand this relief given by the government to the taxpayers through an example. Suppose your income is Rs 7,00,100 means Rs 7 lakh 100 means your income is Rs 100 more than tax free income. Now you have to pay tax of Rs 25,010 because of the excess of just Rs 100. The government has given relief to such taxpayers. Under the new proposal, if your income is Rs 7,00,100, then they will not have to pay tax of Rs 25,010. Rather, they will have to pay tax only on Rs 100. Tax experts have told according to the calculation that individual taxpayers whose income is up to Rs 7,27,777 can get the benefit of this provision.

Income up to Rs 7 lakh was tax-free in the budget.

In Budget 2023, Finance Minister Nirmala Sitharaman had announced that now those earning up to Rs 7 lakh will not have to pay any tax. Earlier, after adopting the tax exemption options, no tax had to be paid up to 5 lakhs. But the new tax regime will give an additional benefit of Rs 2 lakh.

The post Finance Bill Amendments: Good news! Now tax exemption has been given on income of more than Rs 7 lakh, how will you get the benefit? first appeared on Rightsofemployees.com.

He has been demanding from the Finance Minister for a long time to increase the limit of exemption available under 80C. If tax experts are to be believed, then they are expecting that the government can make big announcements in this budget. Lok Sabha elections are going to be held in the year 2024 and this is the last budget before the Lok Sabha elections.

In such a situation, the government can make populist announcements in this budget. There can be such announcements in this budget in which the income of the common people will increase and there will be more discount on savings. Finance Minister Nirmala Sitharaman may increase the limit of 80C in the budget to be presented on February 1, 2023, increase the limit of investment in PPF, increase the limit of taxable income to Rs 5 lakh.

Increased limit of exemption available under 80C

All the employed employees are giving this suggestion to Finance Minister Nirmala Sitharaman for the budget that the government should increase the limit of exemption under 80C. The government has not made any specific announcement for 80C for many years. All taxpayers and salaried individuals invest in tax saving options to get Rs 1.50 off in tax under 80C. Employed people are demanding to increase this limit from Rs 1.50 lakh to Rs 2 lakh.

Tax free income should be increased

If tax experts are to be believed, then income up to Rs 2.50 lakh is tax free for salaried taxpayers. The government should increase this limit to Rs 5 lakh. After Kovid, the need for savings has increased the most. By doing this the disposable income of the government will increase and this will only benefit the economy.

Maximum tax slab should be reduced

The maximum tax slab in income tax should be reduced to 25 per cent as at present the highest tax slab is 42.74 per cent including surcharge and cess. The government also needs to reduce the maximum tax slab. All taxpayers are expecting that the government will make big announcements for common taxpayers on 1st February.

The post Tax exemption: These 3 big announcements regarding tax exemption, Finance Minister will give relief on February 1 first appeared on Rightsofemployees.com.