Important Income Tax Threshold Limits for AY 2025-26 for Individuals

The Income Tax Act for the Assessment Year (AY) 2025-26 introduces key threshold limits and provisions applicable to individuals, encompassing both the old and new tax regimes. Here’s a detailed overview of these provisions to help taxpayers understand their obligations under different scenarios:

1. Basic Exemption Limits

Old Tax Regime:

• Income Slab: ?0 – ?2,50,000 – Tax Rate: Nil
• Income Slab: ?2,50,001 – ?5,00,000 – Tax Rate: 5%
• Income Slab: ?5,00,001 – ?10,00,000 – Tax Rate: 20%
• Income Slab: Above ?10,00,000 – Tax Rate: 30%

New Tax Regime:

• Income Slab: ?0 – ?3,00,000 – Tax Rate: Nil
• Income Slab: ?3,00,001 – ?7,00,000 – Tax Rate: 5%
• Income Slab: ?7,00,001 – ?10,00,000 – Tax Rate: 10%
• Income Slab: ?10,00,001 – ?12,00,000 – Tax Rate: 15%
• Income Slab: ?12,00,001 – ?15,00,000 – Tax Rate: 20%
• Income Slab: Above ?15,00,000 – Tax Rate: 30%

2. Surcharge Rates

Surcharge applies to individuals based on total income:

• ?50 lakh to ?1 crore: 10%
• ?1 crore to ?2 crore: 15%
• ?2 crore to ?5 crore: 25%
• Above ?5 crore: 37%

Under the New Regime, the maximum surcharge is capped at 25%. Additionally, for income chargeable under Sections 111A, 112, 112A, and dividend income, the surcharge is limited to 15%.

Cess: A 4% Health and Education Cess is applicable on the total of Income Tax and Surcharge.

3. Income from Salaries

Standard Deduction:

• ?50,000 under the Old Regime
• ?75,000 under the New Regime

4. Income from House Property

Taxpayers can claim deductions for:

• Property Taxes Paid
• Interest on Housing Loans (subject to specified conditions and limits)

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