Great news for salaried people like Ravi! The exciting new tax regime guide 2025 is here, and it means more money in your pocket. The government has made a big change in Budget 2025—now, you don’t have to pay tax on income up to Rs 12 lakh under the new tax regime. That’s a jump from the old limit of Rs 7 lakh, and it’s already helping people save more. Let’s break down how this works, how much more Ravi will get in his salary, and what it means for you in 2025!
How Much Will Ravi’s Salary Increase?
Ravi earns Rs 1 lakh a month, which means Rs 12 lakh a year. Last year, under the new tax regime, he paid Rs 71,500 in taxes annually—that’s Rs 5,958 less in his pocket each month. But thanks to the new tax regime guide 2025, Ravi doesn’t have to pay any tax now because his income is exactly Rs 12 lakh. Starting with his May 1, 2025 salary, he’ll get Rs 5,958 extra every month, which feels like a big raise without even asking for one!
What’s New in the Tax Rules?
The new tax regime guide 2025 brings awesome changes! From April 1, 2025, there’s no tax on income up to Rs 12 lakh. Plus, if you add the standard deduction of Rs 75,000, even people earning Rs 12.75 lakh a year won’t pay any tax. Last year, the tax-free limit was only Rs 7 lakh, so this is a huge jump. The government also increased the tax rebate under Section 87A to Rs 60,000, which means even if your tax is Rs 52,500, you’ll owe nothing after the rebate.
Why Choose the New Tax Regime?
The new tax regime guide 2025 makes things easier for most people. Finance Minister Nirmala Sitharaman says about 90% of salaried people won’t pay tax now—that’s around 1 crore taxpayers! Last year, 75% of people already picked the new tax regime, and with this change, up to 97% might switch. The new regime is now the default option when you file your ITR, but you can still choose the old one if it works better for you.
Who Benefits from the Old Tax Regime?
The old tax regime might still help some people, as per the new tax regime guide 2025. If you pay for things like house rent (HRA), home loans, life insurance, mutual funds, kids’ school fees, medical insurance, or NPS, you can save tax with deductions under Chapter 6-1. But for someone like Ravi, the old regime means paying Rs 1,63,800 in tax yearly, even with deductions. Since the new regime gives him zero tax, it’s a better deal for most salaried people.
How to Switch to the New Tax Regime
Not sure how to use the new tax regime guide 2025? It’s easy! When you file your ITR, the new regime will already be selected as the default. If you want the old regime, just tell your employer or pick it while filing. You can also talk to your company’s HR to update your tax choice for the year. Check your payslip every month to see how much tax is being deducted, and if you’re not sure, ask a parent or teacher to help you understand your options.
Extra Tips for Salaried People
To make the most of the new tax regime guide 2025, keep track of your yearly income—use a notebook or app to add up your salary. If your income is close to Rs 12.75 lakh, you’re in luck with zero tax! Share this news with friends on WhatsApp so they can save money too. Also, follow budget updates on X to stay informed about more tax changes. If you’re saving for something big, like a bike, this extra money can help you reach your goal faster!
This new tax regime guide 2025 is a game-changer for salaried people. With more money in your pocket, you can save or spend on things you love. Share this guide with your friends, and let me know if you have questions—I’m here to help!
FAQs About New Tax Regime Guide
Que: What’s the new tax regime guide 2025 about?
Ans: It’s the new rule starting April 2025 where you don’t pay tax on income up to Rs 12 lakh, helping salaried people save more.
Que: How much tax does Ravi save with the new tax regime guide?
Ans: Ravi saves Rs 71,500 a year, or Rs 5,958 a month, because his Rs 12 lakh income is now tax-free.
Que: Who benefits most from the new tax regime guide 2025?
Ans: Salaried people earning up to Rs 12.75 lakh a year benefit the most—they pay zero tax with the new rules.
Que: Can I still use the old tax regime with the new tax regime guide?
Ans: Yes, you can choose the old regime when filing your ITR, especially if you have deductions like HRA or home loans.
Que: How do I know if I’m under the new tax regime guide?
Ans: Check your payslip or ask your company’s HR—the new regime is the default option starting April 2025.
Que: Will the new tax regime guide 2025 change again?
Ans: It might—follow budget news on X or ask your parents to keep an eye on government updates for 2026!