Good news for the common people of India. If you’re currently enjoying a tax-free salary of Rs 12 lakh, get ready for some unexpected news. The government is planning to make some changes that could directly impact your finances. Finance Minister Nirmala Sitharaman has hinted at a potential redefinition of salary-related perks and benefits in the upcoming budget for the 2025 financial year.
In simpler terms, the perks included in your salary might be under scrutiny. While nothing has been officially confirmed yet, it’s expected that this topic will be addressed in the Income Tax Bill that will be presented in Parliament next week.
At the moment, you can enjoy perks worth up to Rs 50,000 without incurring any taxes. This includes items like laptops, Sodexo vouchers, free housing, company cars, subsidized meals, medical benefits, club memberships, and travel allowances, all of which are tax-free. Additionally, expenses such as your mobile bill, provident fund contributions, entertainment costs, and gym memberships also enjoy this tax-free status.
However, these perks could be in jeopardy. If the government decides to remove these benefits from your salary, you may end up paying taxes on expenses like your mobile bill, gym fees, and petrol costs, which would then be added to your taxable income. This shift could significantly raise your overall taxable income.
On a positive note, the government has offered some relief to salaried individuals. A key highlight in the budget was the decision to keep income up to Rs 12 lakh tax-free under the new tax regime. Furthermore, for those earning Rs 12.75 lakh with a standard deduction of Rs 75,000, the effective income tax rate has been reduced to zero. This news has certainly brought joy to many in the salaried class, from employees to management.