No Tax on Rs 12 Lakh Income? Here’s What You Need to Know!
The Indian government has introduced a tax relief plan for middle-class earners. Under the new tax regime, individuals earning up to Rs 12 lakh annually pay zero income tax. Let’s break down the tax calculation and benefits.
How Does the Rs 12 Lakh Exemption Work?
Many assume earning over Rs 12 lakh means tax applies to the entire amount. That’s not true! The exemption applies only if total income is up to Rs 12 lakh. If income exceeds this, tax applies as per slabs.
New Tax Slabs (2024)
| Income Slab (Rs) | Tax Rate |
|---|---|
| 0 – 4,00,000 | 0% |
| 4,00,001 – 8,00,000 | 5% |
| 8,00,001 – 12,00,000 | 10% |
| 12,00,001 – 16,00,000 | 15% |
| 16,00,001 – 20,00,000 | 20% |
| 20,00,001 – 24,00,000 | 25% |
| Above 24,00,000 | 30% |
Example: Tax Calculation for Rs 15 Lakh
| Income Slab (Rs) | Tax Rate | Tax Amount (Rs) |
| 0 – 4,00,000 | 0% | 0 |
| 4,00,001 – 8,00,000 | 5% | 20,000 |
| 8,00,001 – 12,00,000 | 10% | 40,000 |
| 12,00,001 – 15,00,000 | 15% | 45,000 |
| Total Tax Payable | – | 1,05,000 |
Did You Know?
Under the old tax regime, income above Rs 10 lakh was taxed at 30%! The new system helps middle-income earners save more.
Conclusion The new tax regime benefits those earning up to Rs 12 lakh with zero tax liability. Those earning higher still pay lower taxes than before. Evaluate your options and choose the best regime!
