Income Tax Highlights at a Glance Union Budget 2025
Income Tax Highlights at a Glance Union Budget 2025, presented by Finance Minister Nirmala Sitharaman on February 1, 2025, introduced several key changes to India’s income tax structure. These changes aim to benefit the salaried class, encourage savings, and boost overall economic growth. Below is a comprehensive breakdown of the new tax regime, presented in an engaging format with visuals, emojis, and key statistics.
📅 Major Income Tax Reforms in Budget 2025
1. Increased Income Tax Exemption Threshold 🌟
The government has raised the income tax exemption limit from ₹7 lakh to ₹12 lakh under the new tax regime. With a standard deduction of ₹75,000, individuals earning up to ₹12.75 lakh annually will now be exempt from paying income tax.
🔍 Example: If a person earns ₹12 lakh, they will pay zero tax under the new structure!
2. Revised Income Tax Slabs 📏
The revised income tax slabs ensure that lower-income groups benefit from reduced tax rates, while high earners contribute proportionately more.
| Income Range (₹) | Tax Rate |
| Up to 4,00,000 | Nil |
| 4,00,001 to 8,00,000 | 5% |
| 8,00,001 to 12,00,000 | 10% |
| 12,00,001 to 16,00,000 | 15% |
| 16,00,001 to 20,00,000 | 20% |
| 20,00,001 to 24,00,000 | 25% |
| Above 24,00,000 | 30% |
📊 Impact of New Slabs:
- Middle-class taxpayers will experience a lower tax burden.
- Higher-income earners will contribute at a higher rate.
3. 💰 Increase in TDS and TCS Thresholds
📈 Changes in Tax Deducted at Source (TDS):
- The TDS threshold on interest income for senior citizens has been increased from ₹50,000 to ₹1 lakh.
- TDS on rent has been raised from ₹2.4 lakh to ₹6 lakh annually.
🌿 Benefits of Higher TDS Limits:
- Senior citizens will benefit from higher tax-free interest income.
- Tenants paying higher rents will have a reduced TDS burden.
4. 🎉 Tax Exemption on National Savings Scheme (NSS) Withdrawals
- Withdrawals from the National Savings Scheme (NSS) made on or after August 29, 2024, will be fully tax-exempt.
- This aims to encourage long-term savings and investment.
5. 🔄 Extended Filing Period for Updated Returns
To provide flexibility, the time limit to file updated income tax returns has been extended from two years to four years.
🎨 Visualizing This Change: 👀 Previously: Taxpayers had 2 years to update their ITR. 🌟 Now: They have 4 years to correct errors or update their returns!
📈 Key Benefit: More time for taxpayers to rectify errors and comply with tax laws without penalties.
🎉 Overall Impact of Budget 2025 on Taxpayers
👨💼 Salaried Individuals:
- Higher exemption limit = More take-home salary.
- Reduced tax rates in lower income brackets.
🤑 Senior Citizens:
- Higher TDS exemption on interest income = More tax-free savings.
🏢 Business Owners & Professionals:
- Higher TDS threshold on rent = Lower compliance burden.
- Longer time to file updated returns.
📝 Summary of Key Tax Changes in One Table
| Change | Old Limit | New Limit |
| Income Tax Exemption Limit | ₹7 lakh | ₹12 lakh |
| Standard Deduction | ₹50,000 | ₹75,000 |
| TDS on Interest for Senior Citizens | ₹50,000 | ₹1,00,000 |
| TDS on Rent | ₹2.4 lakh | ₹6 lakh |
| Time for Updated ITR | 2 years | 4 years |
🚀 Final Thoughts: What’s Next for Taxpayers?
This budget introduces a taxpayer-friendly approach by reducing direct tax burdens and offering more exemptions.
📅 What Should You Do?
✅ Recalculate your tax liabilities under the new slabs.
✅ Make use of increased exemptions to save more.
✅ File updated returns if necessary.
✅ Stay informed about further tax notifications.
The Union Budget 2025 brings significant relief to middle-class taxpayers, salaried individuals, and senior citizens. With higher exemptions, revised slabs, and reduced compliance burdens, this budget aims to increase disposable income and encourage economic growth.
Stay informed, plan wisely, and make the most of these new tax reforms! 🎉📈