Budget 2024: Will Middle Class Get Tax Relief? Key Benefits That You May Get This Year

Finance Minister Nirmala Sitharaman will present the interim budget on February 1. A sense of anticipation surrounds this budget, as indications suggest substantial changes in store for taxpayers.

With the country heading for General Elections, the tax-payers might expect some key announcements. Here's a breakdown of the changes that may happen this year:

Standard Deduction Increase: The threshold for the standard deduction may go up from Rs 50,000 to Rs 1,00,000. This means more income won't be taxed.

Taxation on Employer's Contributions: If your employer contributes more than Rs 7.5 lakhs to specific funds, the rules for taxing the excess and any additional earnings need clarification. This includes identifying the fund and understanding accretions in the Superannuation Fund/NPS, along with how to calculate it.

Change in TDS for PF Contributions: Tax Deducted at Source (TDS) on interest earned from employees' PF contributions over Rs 2.5 lakhs annually might now happen when you withdraw or stop working, not as it accrues. This aligns with when the interest is taxed.

Tax Treaty Relief at Withholding Stage: Employers may now have a provision to provide tax treaty relief during the withholding stage.

Electric Vehicle Incentives: There's good news for those buying electric vehicles. The scope of the deduction for their purchase is increasing, including more interest deduction and no time limit for loan approval.

Tax Treatment for Employer-Provided Electric Vehicles: The tax treatment of this benefit needs clarification, if your employer gives you an electric vehicle.

Systematic Lump Sum Withdrawal (SLW) under NPS: There needs to be more certainty about how the amounts received through the Systematic Lump Sum Withdrawal (SLW) facility under the National Pension System (NPS) will be taxed.

These changes will simplify and clarify various tax-related matters for the benefit of the public.