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Pay 10,000/month for 10 years, Get 1,65,805/Year* for next 15 years.
ARN. No. KLI/23-24/E-BB/1201
Features
Ref. No. KLI/22-23/E-BB/999
For the fiscal year 2023-24, individuals with a total income up to ₹5,00,000 are eligible for a tax rebate of ₹12,500 under Section 87A, providing significant relief in their income tax liabilities.
Taxpayers in India are now navigating the complications of the Income Tax Act and seeking ways to optimize their tax liabilities. One notable provision that can significantly benefit individual taxpayers is the rebate offered under Section 87A.
In both the preceding and current income tax structures, there has been no alteration in the rebate amount granted under Section 87A for the fiscal years 2021-22 and 2022-23 (Assessment Years 2022-23 and 2023-24). An individual with a taxable income of up to ₹5,00,000 remains eligible for a tax rebate of ₹12,500, or the amount of tax payable (whichever is less).
However, there has been a modification in the rebate amount under Section 87A for the fiscal year 2023-24 (Assessment Year 2024-25) under the new income tax regime. Individuals with a taxable income of up to ₹7,00,000 will receive a tax relief of ₹25,000. It is worth noting that the rebate under the former tax regime remains consistent, i.e., ₹12,500 for income up to ₹5,00,000.
If an individual’s total taxable income is up to ₹7,00,000, they will be eligible for the following tax breaks under the new tax regime for the fiscal year 2023-24:
Outlined below are the procedures to avail of a tax rebate under Section 87A:
For individuals below 60 years of age for AY 2023-24:
Source of Income (FY 2023-24) |
Income (₹) |
Gross total income |
6,50,000 |
Less: Deduction* under section 80C |
1,50,000 |
Total income |
5,00,000 |
Income-tax (@ 5% from ₹2.5 to 5 lakh) |
12,500 |
Less: Rebate u/s 87A |
12,500 |
Tax payable |
Nil |
Consider the following points when utilizing the rebate under Section 87A:
Section 87A rebate can be claimed against tax liabilities on:
Individuals are eligible to avail of the rebate under Section 87A for the financial years 2023-24, provided the following conditions are met:
As taxpayers embark on the journey of complying with the income tax regulations for FY 2023-24, they must be aware of provisions like Section 87A. Leveraging rebates can result in significant tax savings for eligible individuals and HUFs. However, it is advisable to seek professional advice or refer to the latest amendments in the Income Tax Act to ensure accurate and up-to-date information.
Understanding and optimizing tax benefits, such as the rebate under Section 87A, can contribute to a more tax-efficient financial plan for individuals and families in the upcoming financial year.
Pay 10,000/month for 10 years, Get 1,65,805/Year* for next 15 years.
ARN. No. KLI/23-24/E-BB/1201
Features
Ref. No. KLI/22-23/E-BB/999
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.