The threshold limit for total income eligible for rebate under Section 87A has been increased from ₹5,00,000 to ₹______ for assesses opting for the new tax regime as per the Finance Bill 2023.

Question

Question

This question was previously asked in

SSC CHSL Exam 2023 Tier-I Official Paper (Held On: 11 Aug, 2023 Shift 3)

Answer 1

The correct answer is 7,00,000.Key Points

The Finance Bill 2023 has proposed an increase in the threshold limit for total income eligible for rebate under Section 87A for assesses who opt for the new tax regime.
Section 87A provides a rebate of up to Rs.12,500 to taxpayers whose total income does not exceed a certain limit.
This limit has been increased from Rs. 5,00,000 to Rs. 7,00,000 for assesses opting for the new tax regime.
The new tax regime was introduced in the Union Budget 2020 and offers lower tax rates to taxpayers who forego certain deductions and exemptions.

Additional Information

The tax rates under the new regime are as follows:
- For income up to Rs. 2.5 lakhs: Nil
- For income between Rs. 2.5 lakhs and Rs. 5 lakhs: 5%
- For income between Rs. 5 lakhs and Rs. 7.5 lakhs: 10%
- For income between Rs. 7.5 lakhs and Rs. 10 lakhs: 15%
- For income between Rs. 10 lakhs and Rs. 12.5 lakhs: 20%
- For income between Rs. 12.5 lakhs and Rs. 15 lakhs: 25%
- For income above Rs. 15 lakhs: 30%
11,00,000 is the threshold limit for availing the standard deduction for salaried individuals.
The standard deduction is a fixed deduction allowed to salaried individuals in lieu of certain expenses such as conveyance, medical expenses, etc.
8,00,000 is the threshold limit for senior citizens to avail of tax exemption on interest income from deposits with banks, post offices, and cooperative banks.
10,00,000 is the threshold limit for tax exemption on long-term capital gains arising from the sale of equity shares or equity-oriented mutual funds.