Income Tax Slabs FY 2024-25

Taxes can often feel overwhelming, especially when you’re unsure about the income tax slabs applicable to you. If you’re trying to save money or invest wisely, understanding the tax system is essential. The key to this is knowing the updated income tax slabs and making use of tools like an income tax calculator to plan your taxes efficiently.
Additionally, exploring investments like a life insurance plan not only ensures the financial protection of your loved ones but also provides tax-saving benefits under Indian law.

What Are Income Tax Slabs?

India follows a progressive tax system, meaning higher income earners pay a higher percentage of tax. The income tax slabs determine the rate of taxation for different levels of income, which are adjusted annually.
In simpler terms, an income tax slab is a range of incomes taxed at a particular rate.
For FY 2024-25, the government has made slight changes to the tax structure for the new regime, ensuring that the tax burden is distributed equitably. Here is a breakdown of the income tax slab for FY 2024-25:
Income up to ₹3,00,000: No tax
Income from ₹3,00,001 to ₹7,00,000: 5%
Income from ₹7,00,001 to ₹10,00,000: 10%
Income from ₹10,00,001 to ₹12,00,000: 15%
Income from ₹12,00,001 to ₹15,00,000: 20%
Income above ₹15,00,000: 30%
The new regime offers these slab rates and doesn’t allow certain deductions. It’s essential to choose the tax regime that aligns with your financial goals, which you can calculate using an income tax calculator.

How Can Life Insurance Help You Save on Taxes?

While calculating taxes, many overlook how useful a life insurance plan can be in reducing tax liabilities. Under Section 80C of the Income Tax Act, premiums paid towards life insurance policies qualify for a deduction of up to ₹1.5 lakh per annum. This means that by investing in a life insurance policy, you not only secure the future of your family but also reduce your taxable income.
Additionally, under Section 10(10D), the maturity benefits received from life insurance policies are entirely tax-exempt, provided specific conditions are met. Life insurance thus plays a dual role: providing financial security and offering tax-saving advantages. However, this applies only if you have selected the old regime of taxation.

Let’s look at the income tax rates for FY 2024-25 under the old tax regime that is applicable to most individuals below the age of 60:
From 0 to 2,50,000: 0%
From 2,50,001 to 5,00,000: 5%
From 5,00,001 to 10,00,000: 20%
From 10,00,001 and above: 30%

Why Use an Income Tax Calculator?

Calculating taxes manually can be time-consuming and prone to errors. An income tax calculator is an essential tool for anyone looking to understand their tax liability better. These calculators allow you to input your income, deductions (like life insurance premiums), and other variables to get a clear estimate of your tax outflow.
By using an income tax calculator, you can see how different investments, like a life insurance plan, can reduce your taxable income and help you save more in the long run.

Navigating income tax rules can be complex, but using tools like an income tax calculator and investing in a life insurance plan can simplify the process. By understanding the applicable income tax slab for FY 2024-25, you can take control of your finances, reduce your tax burden, and secure your future.
Explore life insurance today and see how it can help you not just protect your family, but also save on taxes.