Is the Standard Deduction Set for a Major Increase in the Upcoming Budget?
As the Budget approaches, taxpayers are eagerly anticipating potential benefits the Finance Minister might announce. One key area of interest is the potential increase in the standard deduction limit. Introduced in the 2018 Budget, the standard deduction of Rs 40,000 for salaried individuals replaced the earlier travel allowance (Rs 19,200) and medical deduction (Rs 15,000). In the 2019 interim budget, this limit was raised to Rs 50,000. However, since the combined total of the old deductions was Rs 34,200, the current limit offers only a slight increase in savings. Many experts believe the upcoming budget could see this standard deduction increased to Rs 1 lakh per annum. Understanding the Standard Deduction The standard deduction is a flat amount that salaried individuals can deduct from their income without needing to provide proof to their employer or the IT Department. Currently, this deduction is up to Rs 50,000 per year and is available to all employees, whether in the priv...