Here is how to calculate your income tax benefits
New Delhi: Finance Minister Piyush Goyal on Friday doled out tax sops to middle class including doubling of income tax exemption limit to Rs 5 lakh, raising standard deduction to Rs 50,000 and provided concessions on interest income from bank deposits and rent.
"Individuals with income up to Rs 5 lakh will not be required to pay any tax," Goyal said while presenting Interim Budget for 2019-20 in Lok Sabha. He said with this, individuals who are earning gross income of Rs 6.5 lakh per year and have made investments in savings instruments, will be exempt from paying income tax.
"This will provide benefit of Rs 18,500 to 3 crore middle class taxpayers self-employed, senior citizens," he said, adding the number of beneficiaries will go up for those who have made investments in mediclaim and pension.
No tax will be deducted on interest earned on bank and post office deposits of up to Rs 40,000 annually, up from Rs 10,000 currently. The Budget also proposed to exempt tax on notional rent for unsold housing units for two years.
Goyal also proposed that benefit of rollover of capital tax gains be increased from investment in one residential house to that in two residential houses, for a taxpayer having capital gains of up to Rs 2 crore. However, it can be exercised once in a lifetime, he added.
The Income Tax department will move towards faceless assessment and verification of returns, Goyal said Friday. Standard deduction has been raised from Rs 40,000 to Rs 50,000 which will benefit three crore salaried individuals.
Following is the table of impact on individual on tax proposals (in Rs):
Income Tax benefit chart
INCOME TAX TABLE
|Salary||5 lakh||5 lakh||7.5 lakh||7.5 lakh||20 lakh||20 lakh|
|Net total income||4.6 lakh||4.5 lakh||7.1 lakh||7 lakh||19.6 lakh||19.5 lakh|
Source: B S R & Co. LLP