How ₹7.5 lakh income is tax-free?

In Budget 2023, the finance minister introduced a new simplified tax regime under which taxpayers with an annual income of up to ₹7 lakhs will not have to pay any tax. Additionally, the new regime has allowed a standard deduction of ₹75,000. Therefore, taxpayers with incomes up to ₹7.75 lakhs can opt for the new tax regime and have zero tax liability.

To benefit from this, taxpayers should first assess their income and categorise it correctly to determine their taxable income. They should then opt for the new tax regime while filing returns to avail the ₹7 lakh basic exemption limit.

Taxpayers should also maximise deductions by making investments and expenditures that qualify under the new regime. This will help bring down the net taxable income