Union Budget 2021 Income Tax Slab Expectations: A government official said that even in the new system, the government can give tax exemption on PF and Leave Travel Allowance.
Union Budget 2021 Income Tax Slab Expectations: Finance Minister Nirmala Sitharaman is going to present the general budget on 1 February. There are many expectations about this general budget being presented between the Corona period. In particular, changes are expected in the new system of income tax slabs.
Two options for income tax system: Actually, in the budget 2020, Finance Minister Nirmala Sitharaman announced two options for income tax system for taxpayers. Accordingly, taxpayers can now choose between the old or the new system. Deductions are found in the old system as before while taxpayers do not get relief of deductions by selecting the new system.
Expectations from this time budget: In this year’s general budget, the government can make some big announcements regarding the new income tax system. During the interaction with Indian Express, a government official said that in the new system, the government can give tax rebate on PF and Leave Travel Allowance.
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Let us tell you that LTA is part of an employee’s CTC ie Cost to Company. Under the Income Tax Act, employees can claim exemption for traveling within the country. According to the official, the government is willing to give more benefits under the new tax system. The aim is to prioritize and encourage the new tax system.
This exemption is not available in the new tax system: The new tax system does not include the rebate on investment under section 80C. Let us tell you that in the old tax system, EPF, PPF, Mutual Fund, LIC and other tax saving schemes or deposits are exempted.
Apart from this, in the new system, you can not take advantage of the discount on standard deduction. The loan taken for education is also helpful in saving tax. You will not be able to take this deduction in the new system.
