It has been revealed that income taxpayers will lose exemptions and deductions in nearly 70 or more categories for the current Income Tax slab in FY 2024-25. These include investment exemptions of INR 1.5 lakh on section 80C, premium payment deduction of section 80D on health insurance and interest on saving done in 80TTE.
Also, it is worth noting that Finance Bill 2024 still retains some tax exemptions which would offer tax exemptions on certain tax payments.
Here we will detail some of the exemptions which are still available for income taxpayers:
Interest on Post Office Saving Account – As per the Income Tax Act section 10(15)(i), the interest available on the post office account balance is free of tax till a certain amount. In the case of a personal account, the limit is INR 3500 while the limit for the joint account is INR 7000.
Gratuity From Employer – The employees are eligible for tax exemptions on gratuity received on completion of 5 years in a private office. As per the income tax rule, private employees can get up to 20 lakh gratuity amount tax-free while government employees do have gratuity tax-free without any limit.
Exemption on Life Insurance Maturity Amount – Although one cannot take tax deductions under section 80C on the life insurance premium the maturity amount is totally tax exempted as per the provisions under section 10(10D).
Read Also: Current Income Tax Slab Rates for Taxpayers
Interest accumulated on EPF contribution – From the financial year 2021-22 interest earned on employee contributions up to Rs 2.5 lakh in a year is tax-free and interest above 2.5 lakh in a financial year is taxable.
Section 80CCD(1B) Contribution – It provides an additional deduction of Rs.50,000 on their NPS contributions. Section 80CCD(1B) offers an excellent opportunity to save a substantial amount of taxation liabilities. This deduction is over and above the deduction available under section 80C.
PPF Maturity Amount and Interest – Contribution in the PPF account may not be tax-free however maturity amount will be tax-free and interest on the PPF will be tax-free.
Interest on Sukanya Samriddhi Yojana – The investors in the Sukanya Samriddhii Yojana will have a tax-free interest also the payments will be tax-exempt too.
Read Also: Section-Based Income Tax Saving Tips For Salaried Person
Employers Gift – The gift from the employer is tax-free unless its value exceeds INR 5000.
Leave Encashment on Retirement – Upon retirement, many companies pay cash for the leaves not taken the exemption threshold for leave encashment is INR 25 lakh for private organizations.
VRS Amount – The retirement amount of less than INR 5 lakh is free from tax and the provision is in both new and old tax schemes.
