Income Tax Planning•5 min read•Published: 2025-02-27
Standard Deduction Explained: ₹75,000 in New Regime vs ₹50,000 in Old
Standard deduction is a flat deduction allowed from gross salary without requiring any bills, proofs, or expense receipts.
Key Financial Takeaways
- New Regime: Increased to ₹75,000 for salaried employees and pensioners in Budget 2024.
- Old Regime: Remains ₹50,000.
- Available to all salaried individuals regardless of whether they incur actual work-related expenses.
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How Standard Deduction Saves You Tax
Standard deduction directly reduces your gross salary before tax slabs are applied. For someone in the 30% slab, a ₹75,000 deduction saves ₹23,400 directly in annual tax.
Frequently Asked Questions
Do self-employed individuals get standard deduction?
No, Section 16(ia) standard deduction is exclusively available to salaried employees and pensioners.
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