Download Auto Calculate Income Tax Arrears Relief Calculator U/s 89(1) with Form 10E for the
F.Y.2023-24 | Individuals living under the existing tax regime with a total income of up to Rs 500,000
can avail of tax relief up to Rs 12,500 under Section 87A for AY 2023-24. Individuals who have opted
for the new tax regime under section 115BAC and whose total income is up to Rs 700,000 can claim a
a higher tax credit of up to Rs 25,000 u/s 87A.
A.Y 2023-24 onwards Tax rate 87A
(Existing regime)
Section 87A of the Income Tax Act,1961 provides 100% tax relief for residents with taxable income up to Rs 12,500 and up to Rs 500,000 from 2023-24. It should be noted that if the total income exceeds Rs 500,000, there will be no marginal relief, unlike the tax relief in the new tax regime from 2024-25.
Thus, a resident with a total income of up to Rs.5,00,000 can claim a full tax credit of up to Rs.12,500 u/s 87A as an exemption from tax liability.
87A Tax rate for AY 2024-25 onwards (New
regime).
Section 44 of the Finance Act 2023 has introduced a maximum tax relief of up to Rs 25,000 to residents with gross income up to Rs 700,000 and who have opted for the new tax regime under Section 115BAC of the Tax Act of Ownership, 1961. A.Y 2024-25 from date. Further, limited relief is provided to such taxpayers for income exceeding Rs 700,000 to avoid this tax deduction.
Marginal relief for the rate of tax u/s
87A
If the marginal difference in tax liability (for example, 700,000 Lakh in income minus tax) is greater than the marginal difference in income (i.e., total income minus 700,000 Lakh), then the marginal rate is at level 87A. Such excess for A.Y 2024-25 provides a tax deduction of up to Rs.2500. This calculation procedure is similar to the calculation of marginal relief from overburden.
