Personal Tax Benefits After Union Budget 2014-15

New government presented the budget for the financial year 2014-15. There is some benefit has been given to individual tax payers. Basic exemption limit has been increased by Rs 50000, Investment limit under section 80 C has been revised from Rs 1 lac to Rs 1.5 lac, home loan interest tax benefit for self occupied house also increased from 1.5 lac to 2 lac.

In this post we will try to see how much tax benefit individual tax payer will be getting from these changes.   

Exemption limit

Basic Exemption limit raised from Rs. 2 lacs to Rs. 2.50 lacs for general category of individuals and from Rs. 2.5 lacs to 3 lacs for senior citizen. So in total Rs 50000 has been added to exempted limit. 

Let’s see how much tax we can save due to increase in Exemption limit. 

	FY 2014-15	FY 2013-14
Income	500000	500000
Exemption  Limit	250000	200000
Net Income	250000	300000
Tax on Net Income	25000	30000
Education Cess @ 3%	750	900
Total Tax	25750	30900
Total Tax Saving	5150

(Calculation done for non senior citizen and all the figures are in INR)

Section 80C Deductions

Section 80C deduction increased from Rs. 1lac to Rs. 1,5 lacs. Investment limit for PPF scheme has also been increased from current 1lac to 1.5 lacs.

Let’s see how much tax we can save due to increase in Exemption limit and increase in 80C deductions.

10% Tax Slab ( Maximum Tax Saving 10300)
	FY 2014-15	FY 2013-14
Income	500000	500000
Exemption  Limit	250000	200000
80 C Deduction	150000	100000
Net Income	100000	200000
Tax on Net Income	10000	20000
Education Cess @ 3%	300	600
Total Tax	10300	20600
Total Tax Saving	10300

(Calculation done for non senior citizen and all the figures are in INR)

20% Tax Slab ( Maximum Tax Saving 15450)
	FY 2014-15	FY 2013-14
Income	1000000	1000000
Exemption  Limit	250000	200000
80 C Deduction	150000	100000
Net Income	600000	700000
Tax on Net Income	95000	110000
Education Cess @ 3%	2850	3300
Total Tax	97850	113300
Total Tax Saving	15450

(Calculation done for non senior citizen and all the figures are in INR)

  

30% Tax Slab ( Maximum Tax Saving 20600)
	FY 2014-15	FY 2013-14
Income	1500000	1500000
Exemption  Limit	250000	200000
80 C Deduction	150000	100000
Net Income	1100000	1200000
Tax on Net Income	230000	250000
Education Cess @ 3%	6900	7500
Total Tax	236900	257500
Total Tax Saving	20600

 (Calculation done for non senior citizen and all the figures are in INR)

Home Loan Interest

Deduction u/s 24 for Interest on Housing loan for self-occupied house property has been increased from Rs. 1.5 lacs to Rs. 2 lacs. Below table shows additional how much maximum tax we can save.

10% Slab	5150
20% Slab	10300
30% Slab	15900

(All the figures are in INR)