Offers
Rates
V-KYC
Debit Card Related
Credit Card Related
SA Welcome Kit 
Manage Mandate(s)
Get Mini Statement
categories
Bloggers
Blog collection
Press Release
New Tax Regime: How Taxpayers Can Save up to ₹17,500 a Year in Income Tax
Posted on Wednesday, July 31st, 2024 | By IndusInd Bank
Budget 2024, announced by Finance Minister Nirmala Sitharaman on 23 July 2024, brings several changes aimed at boosting the economy and providing relief to taxpayers. Among the various announcements, the most crucial attraction is the revamped New Tax Regime (NTR). Designed to simplify taxation, the NTR introduces higher standard deductions and revised tax slabs, which may allow individuals to save income tax and get financial benefits.
Specifically, the adjustments in Budget 2024 are expected to allow taxpayers to save up to ₹17,500 under the new tax regime. But how? Let’s find out.
Key Changes in the New Tax Regime
Increased Standard Deduction: For employees opting for the new tax regime, the standard deduction has been increased from ₹50,000 to ₹75,000 (under Section 115BAC).
Revised Tax Slabs: The income slabs have been structured as follows to promote tax saving in the new regime:
| Income Tax Slabs | Income Tax Rate |
| Up to ₹3,00,000 | 0% |
| ₹3,00,001 to ₹7,00,000 | 5% |
| ₹7,00,001 to ₹10,00,000 | 10% |
| ₹10,00,001 to ₹12,00,000 | 15% |
| ₹12,00,001 to ₹15,00,000 | 20% |
| ₹15,00,001 and above | 30% |
How the Changes in New Tax Regime Could Save You ₹17,500 Annually?
Suppose a taxpayer earns a little over ₹15,00,000 annually and falls in the 30% tax bracket. Here’s how they can save ₹17,500 every year.
₹3-7 Lakh Income
- Under the previous regime, the tax liability for ₹3 to 6 lakh was ₹15,000
- Now, with the slab extending to ₹7 lakh, the tax liability increases to ₹20,000
- This results in an additional tax of ₹5,000 (5% of ₹1,00,000)
Savings in the ₹10-12 Lakh Income Bracket
- Previously, the tax liability for ₹9 to 12 lakh would come around ₹45,000
- With the new slabs, the tax liability for income between ₹10 to 12 lakh remains at 15%, bringing it to ₹30,000
- The savings here amount to ₹15,000 (₹45,000 – ₹30,000)
Considering both I and II, the overall savings till now are ₹10,000 (₹15,000 – ₹5,000).
Additional Standard Deduction
- The standard deduction increase from ₹50,000 to ₹75,000 means additional savings of ₹25,000
- For someone in the 30% tax bracket, this equates to ₹7,500 saved (30% of ₹25,000)
When you combine the savings from tax slab changes and increased standard deduction, you get ₹10,000 + ₹7,500 = ₹17, 750.
Making the Most of Your Tax Savings with IndusInd Bank Fixed Deposits
As you can see, Budget 2024 has made it possible to save an extra ₹17,500 that you would otherwise have paid as tax. Consider investing this additional cash wisely. IndusInd Bank Fixed Deposits offer a safe avenue to place your savings and earn a high interest rate. Besides predictable and risk-free returns, enjoy additional features like:
- Open a fixed deposit account quickly from anywhere
- A 100% digital process means only your Aadhaar and PAN card details are required
- Save on taxes by booking a five-year tax-saving FD
- Complete video KYC and effortlessly book an FD with a flexible amount
- Decide how often you want to get interest payments (monthly, quarterly, every six months, yearly, etc.)
Also Read: Navigating the Benefits of Auto-Renewal Fixed Deposits
Key Takeaways
Budget 2024 brings substantial relief to taxpayers through revised tax slabs and increased standard deductions under the new tax regime. These changes ensure that taxpayers, especially those in the middle and higher income brackets, can save up to ₹17,500 annually.
As you navigate these changes, adding stable investment options like IndusInd Bank Fixed Deposits could further solidify your financial stability and growth. Benefit from best-in-class interest rates, hassle-free online booking, flexible tenure, and multiple interest payout options. Give your hard-earned money the financial boost it deserves.
Disclaimer: The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.
