New Income-tax Slab Rates, New Deduction Limits and Employer Contribution Rates
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On the 16th of August 2024, the President of India approved the 2024/25 Budget. The budget was presented by the Finance Minister on the 23rd of July 2024. The Budget introduces new Income-tax slabs, rates, new deduction limits and employer contribution rates.
See detailed changes below:
Previous and new income-tax slabs for the new tax regime:
| Tax Slabs (Amounts in INR) | Period 01-04-2023 31-03-2024 | Period 01-04-2024 31-03-2025 |
|---|---|---|
| Up to 300,000 | Nil | Nil |
| 300,001 – 600,000 | 5% of excess over 300,000 | - |
| 300,001 – 700,000 | - | 5% of excess over 300,000 |
| 600,001 – 900,000 | 10% of excess over 600,000 | - |
| 700,001 – 1,000,000 | - | 10% of excess over 700,000 |
| 900,001 – 1,200,000 | 15% of excess over 900,000 | - |
| 1,000,001 – 1,200,000 | - | 15% of excess over 1,000,000 |
| 1,200,001 – 1,500,000 | 20% of excess over 1,200,000 | 20% of excess over 1,200,000 |
| Over 1,500,001 | 30% of excess over 1,500,000 | 30% of excess over 1,500,000 |
Increase in deduction and employer contributions:
- The standard deduction limit under the head salary has been increased from Rs. 50,000 to Rs. 75,000.
- Deduction of employer’s contribution under Section 80CCD(2) has been increased from 10% to 14% of salary and dearness allowance.
Please contact your Mercans’ services delivery team for any additional information regarding the implications of the above change.
Employer of Record (EOR) India | PEO India | Payroll in India
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India – 2024/25 Budget Changes – 01 April 2024
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