India Union Budget 2025 – What’s New for You?

The Indian Union Budget 2025 is a crucial financial plan that outlines the government’s income and spending for the upcoming year.

This budget, presented by Finance Minister Nirmala Sitharaman, focuses on economic growth, employment generation, and financial stability. It impacts various sectors, including businesses, taxpayers, and industries

Introduction

Finance Minister Nirmala Sitharaman has provided major relief to the middle class in the Union Budget 2025. The new tax regime will make income up to ₹12 lakh per year tax-free, while salaried employees will receive a standard deduction of ₹75,000.

Income Tax Slab for FY 2024-25 and FY 2025-26

For more details, refer to the official Income Tax Department

If you’re interested in the Income Tax Slabs for FY 2023-24, refer to this comprehensive article to understand the tax changes from the previous year.

What Has Changed?

Under the new tax regime:

• Income up to ₹12 lakh is tax-free.
• No changes were made to the old tax regime.
• Under Section 87A, income up to ₹12 lakh is exempt from tax.

For detailed updates, visit the Ministry of Finance

How Will You Benefit?

Under the new tax regime:

• The 5% tax on income between ₹4-8 lakh and the 10% tax on income between ₹8-12 lakh will be waived for individuals earning up to ₹12 lakh annually.
• For individuals earning more than ₹12 lakh, the first ₹4 lakh will remain tax-free. However, their tax calculation will include 5% tax on ₹4-8 lakh and 10% on ₹8-12 lakh.

Income Up to ₹12 Lakh Now Tax-Free

Under the new tax regime introduced in the 2025 Union Budget, individuals with an annual income up to ₹12 lakh will be eligible for the nil (zero) tax slab. This means that no tax will be levied on income up to ₹12 lakh.

For salaried taxpayers who receive a standard deduction of ₹75,000, the threshold increases slightly to ₹12.75 lakh. Therefore, salaried individuals earning up to ₹12.75 lakh will also pay no income tax under the new tax regime.

This change is part of the government’s effort to reduce the tax burden on middle-class taxpayers and stimulate economic activity by increasing disposable income.

For more insights on the tax impact, visit the RBI website.

• The income tax exemption limit has increased to ₹12 lakh per year, benefiting around 1 crore taxpayers.
• Over 6.3 crore taxpayers (more than 80%) will benefit from changes in the income tax slab.
• These changes will provide a total relief of ₹1 lakh crore to taxpayers.

For more updates, check the National Portal of India.

TDS Less Tedious; TCS Boost for Trips Abroad

The budget proposes an increase in the limits for Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) to benefit a wide range of individuals:

• Senior citizens and landlords will benefit from higher TDS limits.
• Travelers and parents sending children abroad for education will benefit from the TCS increase. Senior citizens will now be exempt from TDS on interest income up to ₹1 lakh (up from ₹50,000).

For more information on these changes, visit the Open Budgets India portal.

How Students Benefit from Lower TCS on Foreign Remittances

The Union Budget 2025 introduces revised TCS rates for foreign remittances:

• No TCS on remittances up to ₹7 lakh for education-related expenses.
• For loans secured under Section 80E, no TCS on remittances exceeding ₹7 lakh.
• For other cases, the TCS rate remains 5% on amounts above ₹7 lakh.

For more on Section 80E.

What’s Cheaper and What’s Costlier: India Union Budget 2025

Made Cheaper:

• Life-saving medicines, imported cars, and medicines for serious diseases.

Made Expensive:

• Woven fabric, smart meters, solar cells, imported shoes, and PVC-related products.

Compliance for Crypto Investors: India Union Budget 2025

Starting April 1, 2026, a new annual reporting requirement for crypto assets will be introduced, outlining specific rules for reporting entities, information scope, reporting methods, and due diligence procedures.

For more details on crypto regulations, visit the Income Tax India portal.

India Union Budget Estimates 2025-26

• Total receipts (excluding borrowings): ₹34.96 lakh crore
• Total expenditure: ₹50.65 lakh crore
• Net tax receipts: ₹28.37 lakh crore
• Fiscal deficit: 4.4% of GDP
• Gross market borrowings: ₹14.82 lakh crore
• Capex Expenditure: ₹11.21 lakh crore (3.1% of GDP)

For more details, download the Union Budget Speech 2025 PDF

TDS/TCS Rationalization for Easing Difficulties

The budget proposes rationalizing TDS and TCS provisions to ease tax-related challenges:

• Senior citizens’ interest income TDS limit doubled to ₹1 lakh.
• TDS on rent increased from ₹2.4 lakh to ₹6 lakh.
• The TCS threshold on remittances under RBI’s Liberalized Remittance Scheme (LRS) increased from ₹7 lakh to ₹10 lakh.

For further details, visit the Income Tax Department’s.

Conclusion: Preparing for the Future

The India Union Budget 2025 focuses on driving growth, enhancing employment opportunities, and maintaining economic stability. With revised income tax slabs, improved GST regulations, and increased support for businesses, this budget offers a clear path toward simplifying financial management for both individuals and companies. Understanding these key changes will empower you to plan your finances more effectively and capitalize on new opportunities.

Stay updated with the latest government policies to make informed financial decisions!

The Union Budget 2025 presents excellent opportunities for businesses to enhance efficiency and strengthen their financial position. By investing in the right HR and payroll management tools, businesses can streamline operations, reduce risks, and ensure smooth compliance.

Explore the Union Budget 2025 or watch the India Budget 2025 live session on YouTube for updates from the Ministry of Finance and GST compliance.

By staying well-informed and making strategic investments, businesses can fully leverage the benefits of Union Budget 2025 and ensure a prosperous future.

Stay ahead of the latest tax reforms introduced in the Union Budget 2025 with our advanced payroll software, designed to keep your business compliant and efficient.