Tax Changes in Budget 2024-25

Impact to Individuals:

1)     Changes to Personal taxation:

Standard deduction increased to Rs 75,000 from Rs 50,000 only for new tax regime

 

2)     New regime slab rates changed as under:

Income	Old Tax rate	New Income	New Tax rate
Upto 3 Lakhs	Exempt	Upto 3 Lakhs	Exempt
3 – 6 Lakhs	5%	3 – 7 Lakhs	5%
6 – 9 Lakhs	10%	7 – 10 Lakhs	10%
9 – 12 Lakhs	15%	10 – 12 Lakhs	15%
12 – 15 Lakhs	20%	12 – 15 Lakhs	20%
Above 15 Lakhs	30%	Above 15 Lakhs	30%

 

Due to above 2, there is a tax advantage of Rs 17,500

 

3)     In case of new regime, deduction u/s 80CCD towards employers contribution to of NPS increase from 10% to 14%

4)     TCS credit available to employee if any will be considered before deducting TDS u/s 192

5)     Increase in Standard Deduction and deduction from family pension for taxpayers in tax regime from Rs 15,000 to Rs 25,000

 

Impact to Companies:

1)     Abolition of angel tax u/s 56 w.e.f 1^st April 2024

2)     Buy back taxes on shares buy back is no longer exist, same shall be taxed in the hands of the shareholder as deemed dividend. (Cost of share shall be considered as capital loss in the hands of shareholders for foregoing the shares)

3)     TDS rate under Sec 194H  for Payment of commission or brokerage reduced from 5% to 2% w.e.f 1/10/2024

4)     206C to also levy TCS on any other goods of value exceeding ten lakh rupees, as may be notified by the Central Government in this behalf. Such goods would be in the nature of luxury goods

5)     On interest income of government bonds, TDS may be attracted subject to notification.

6)     Direct Tax Vivad se Vishwas Scheme, 2024 will be introduced

7)     Abolition of Equalization levy at 2% w.e.f 1^st Aug 2024 at the same time exemption u/s 10(50) is abolished w.e.f 1^st Aug 2024.

8)     Revised E-TDS return filed earlier no time limit was there but now maximum time limit is upto 6 years

 

9)     Summary of the holding period and tax rates for various category of investments w.e.f 23^rd July 2024:

Nature of Asset	Holding period  to become Long Term	New period of holding for Long term	Indexation available	Short Term Capital Gain Rate *	Long Term Capital Gain Rate*	NEW STCG Rate	NEW LTCG Rate
Listed Equity /preference shares	12 Months	12 Months	No	15%	10%	20%	12.5%
Equity Arbitrage Fund / Equity ETF	12 Months	12 Months	No	15%	10%	20%	12.5%
Equity oriented Mutual Fund (Equity more than 65%)	12 Months	12 Months	No	15%	10%	20%	12.5%
Debt Fund (Non Equity less than 35%) purchase after 1-4-2023	NA	NA	NA	Slab Rate	NA	Slab Rate	NA
Debt Fund (Non Equity less than 35%) purchase before 1-4-2023	36 Months	24 Months	Yes	Slab Rate	20% with indexation	Slab rate	12.5% no indexation
Mixed Fund (Non Equity greater than 35% but less than 65%)	36 Months	24 Months	Yes	Slab Rate	20% with indexation	Slab rate	12.5% no indexation
Market Linked Debentures (MLD)	NA	NA	NA	Slab Rate	NA	Slab Rate	NA
NCD or listed Bond	12 Months	12 Months	No	Slab Rate	10% without indexation	Slab rate	12.5% without indexation
Non Listed Bond	36 Months	24 Months	Yes	Slab Rate	20%	Slab rate	Slab rate
Tax Free Bond	36 Months	24 Months	No	Slab Rate	10% without indexation	Slab rate	12.5% without indexation
Fixed Maturity Plan (FMP)/Debt ETF  purchase after 1-4-2023.	NA		NA	Slab Rate	NA	Slab Rate	NA
Fixed Maturity Plan (FMP)/Debt ETF  purchase before 1-4-2023.	36 Months	24 Months	Yes	Slab Rate	20% with indexation	Slab rate	12.5% without indexation
Zero Coupon Bonds	12 Months	12 Months	Yes	Slab Rate	20% with indexation or 10% without indexation	Slab rate	12.5% without indexation
Immovable Property: Land, Building and House property, Unlisted shares of a company	24 Months	24	Yes	Slab Rate	20% with indexation	Slab rate	12.5% without indexation
REITs (Listed)	12 Months	12	No	15%	10%	20%	12.5% without indexation

 

10.   Foreign companies tax rate reduced to 35% from 40%