What Should Taxpayers Know About ITR Filing? New Tax Slabs & Rules Ahead
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Synopsis
As taxpayers gear up for ITR filing in FY25, knowing the recently introduced tax slabs and capital gains tax rules from the Union Budget 2024 is crucial. This article provides insights from experts to help you navigate these changes effectively.
Key Takeaways
- Familiarize yourself with the new tax slabs for FY25.
- Consider the benefits of the new regime versus the old one carefully.
- Long-term capital gains tax rates have changed significantly.
- Review your eligibility for deductions before filing.
- Stay informed about the NPS contribution changes for tax deductions.
New Delhi, July 26 (NationPress) Taxpayers preparing to file their tax returns for FY25 should familiarize themselves with the newly introduced income tax brackets and capital gains tax framework established by the Union Budget 2024, as per expert advice.
According to the revised tax brackets, individuals earning a taxable income of up to Rs 12 lakh will receive a full tax rebate under the new scheme. Should your taxable income surpass Rs 12 lakh, your earnings will be taxed according to the respective slabs.
The tax structure includes no tax for the first Rs 4 lakh, a 5% tax on earnings between Rs 4 lakh and Rs 8 lakh, a 10% tax on income from Rs 8 lakh to Rs 12 lakh, and a 15% tax on income from Rs 12 lakh to Rs 16 lakh, and so forth.
As a result of this update, the previous tax regime will only benefit those taxpayers who are qualified to claim a Rs 2 lakh deduction for home loan interest under Section 24(b) or a sizable house rent allowance (HRA). Most other deductions are likely insufficient to justify staying with the old regime, according to experts.
The rate for long-term capital gains (LTCG) tax on all financial and non-financial assets has been revised to 12.5% (up from 10% for equities). Short-term capital gains (STCG) tax on certain assets, such as equities, is now 20% (up from 15%). All publicly traded financial assets held for more than a year will now be categorized as long-term assets.
Moreover, the exemption threshold for calculating LTCG tax on stocks and equity mutual funds has been raised from Rs 1 lakh to Rs 1.25 lakh.
The LTCG tax rate on the sale of real estate has been increased from 12.5% to 20%, but the indexation benefit for properties purchased after April 1, 2001, has been eliminated.
From FY 2024–25, even private sector employees who choose the new tax regime and enroll in the corporate National Pension Scheme (NPS) stand to benefit, as employer contributions to employees' basic salaries up to 14% will qualify for deduction. Previously, this limit was just 10%.
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Point of View
Taxpayers must adapt to the new income tax slabs and capital gains tax structure. While the new regime offers substantial benefits, especially for those earning below Rs 12 lakh, the decision to switch from the old tax regime should be made carefully, considering individual financial scenarios.
NationPress
26/07/2025
Frequently Asked Questions
What are the new income tax slabs for FY25?
The new income tax slabs include no tax for the first Rs 4 lakh, 5% on Rs 4 lakh to Rs 8 lakh, 10% on Rs 8 lakh to Rs 12 lakh, and 15% on Rs 12 lakh to Rs 16 lakh.
What is the LTCG tax rate now?
The LTCG tax rate has been revised to 12.5% for all financial and non-financial assets.
How does the NPS contribution change affect taxpayers?
From FY 2024–25, employer contributions to the NPS will be eligible for deduction up to 14%, up from the previous 10%.
Is the old tax regime still beneficial?
The old tax regime may still benefit those eligible for deductions like home loan interest under Section 24(b) or large HRA claims.
What changes have been made regarding the exemption limit for LTCG?
The exemption limit for computing LTCG tax on stocks and equity mutual funds has been increased from Rs 1 lakh to Rs 1.25 lakh.
