Individuals with gross income up to Rs 6.5 lakh will not need to pay any tax if they make investments in provident funds and prescribed equities that are tax-saving schemes, while it may move up further with additional avenues like NPS, medical insurance and home loan interest payment, the finance minister said.
Around three crore middle class taxpayers will get tax exemption due to this measure, Goyal stated while presenting the Budget proposals.
Proposed Income tax changes in Budget 2019:
- Tax on Notional rent on second house property removed
- Basic tax exemption increased to 5 lakhs
- Salary standard deduction increased to 50k from 40k
- TDS threshold for rent 240000 from 180000
- Post office, bank, postal interest TDS exemption increased to 40k from 10k
- Capital gains up to 2 crores can be invested in 2 house property to take exemption. This can be done once in a lifetime.
- 80 IB housing scheme exemption extended by one more year up to 2020
- Unsold inventory of real estate – tax on notional rent will be payable after 2 years as against 1 year
Finance Budget – 2019:
- Tax Slab on Individual Taxpayer has extended to 5 Lakhs. No Tax up to Rs. 5 Lakhs
- Standard Deduction to Salaried Employees has extended from 40,000 to 50,000.
- No Notional Rent up to two self-occupied house property.
- Threshold Limit on TDS on Bank and Post Office Interest has extended from 10,000 to 40,000.
- Threshold Limit on TDS on Rent has extended from 1,80, 000 to 2,40,000.
- Now Two Residential Property can purchase against capital gain on sale of property up to 2 Crore.
- Benefit of 80 IBA has extended up to 31st March 2020.
- Real Estate Sector has now need not to pay tax on Notional Rent on unsold property up to 2 years. (Limit of 1 Year has extended to 2 years).