Income tax for individual is what most tax payers want to know in Budget. In Budget 2016,
the finance minister has made little changes to this. We highlight the changes
and give you the new tax calculator for FY
2016-17 [AY 2017-18].
Income Tax Slab for FY 2016-17 [AY 2017-18]
There is no change in income tax slabs except additional 3%
increase in cess for super rich (i.e. individuals with income > 1 crore).
For Income Tax Purpose – citizens above age of 60 are considered as Senior Citizens
and above age of 80 are considered Very Senior citizens
Changes in Income Tax Rules:
1. There has been no change in the income tax
slabs.
2. For people with net taxable income
below Rs 5 lakh, the tax rebate has been increased from Rs 2,000 to Rs 5,000
u/s 87A. This would benefit
people who have net taxable income between Rs 2.7 Lakhs to Rs 5 Lakhs.
3. Additional exemption for first time home buyer up to Rs. 50,000 on
interest paid on housing loans. This
would be applicable where the property cost is below Rs 50 Lakhs and the home
loan is below Rs 35 lakhs. The loan should be sanctioned on or after April 1,
2016.
4. Tax Exemption u/s 80GG (for rent expenses who do have HRA
component in salary) has been increased from Rs 24,000 to Rs 60,000 per annum. This is a good move to align the exemption amount with today’s
rent and keep the section relevant.
5. Exemption to employer’s contribution to
recognized provident funds limited to 1.5 lakh. Earlier, the cap was up to 12% of salary
Download Income Tax Calculator for F.Y.2016-17 & Assessment Year 2017-18 for Govt& Non Govt employees.
