Income Tax: Those earning up to Rs 19 lakh will not have to pay even a single rupee tax, taxpayers should understand the calculation..

In the Union Budget 2025, under the new tax regime, there will be no tax on income up to Rs 12 lakh. In addition, there will also be the benefit of a tax deduction of Rs 75,000, which will make the total income up to Rs 12.75 lakh completely tax-free.

But do you know that there are some methods, by adopting which annual income up to Rs 19.20 lakh will become tax-free? Let us know how your tax will be zero on income more than 19 lakhs.

In the new tax regime, to get tax exemption on income up to Rs 19.20 lakh, you have to invest in the National Pension System (NPS). By investing in NPS, you can reduce your taxable income and become tax-free. Due to this, your taxable income will be reduced and you will become tax-free. How will your tax be counted on NPS? How much to invest? Before knowing all this, let us understand what will be the salary structure of your annual income of 19.20 lakhs.

Salary Structure-

If you earn 19.20 lakh rupees annually, then you will not get the entire amount in hand. This will be your CTC. Out of that, the basic pay will be 6 lakhs. The personal allowance will be 5 lakh 50 thousand. Minimum PF contribution will be 21,600. The gratuity will be 28,800 rupees. Variable will be 96,000 and Flexi pay will be 6,23,600 for tax-free components.

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You won't have to pay a single penny like this-

In the new tax system, the government gives a standard deduction of ₹ 75,000, which will reduce your income from ₹ 19.20 lakh to ₹ 18,45,000. If you choose the National Pension System (NPS), you will get an additional exemption of 14% of the basic salary (₹ 6 lakh) i.e. ₹ 84,000. After this, your total taxable income will be ₹ 17,61,000.

Flexi Pay Tax-Free-

Apart from this, if the salary is high, then you get the benefit of Flexi Pay Tax-Free Components, in which according to this salary, there will be 2,85,600 conveyances. Books and periodicals will cost Rs 1,08,000. Rs 2,40,000 will be deducted for entertainment and Rs 90,000 annually for uniforms.

The total amount will be Rs 6,23,600, which if we subtract from Rs 17,61,000, the taxable income will be Rs 11,37,400. Since the government has made income up to Rs 12 lakh tax free in the new tax regime, according to this, a person with a CTC of Rs 19.20 lakh will have to pay zero tax.

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