Rebate u/s 87A of the Income Tax Act 1961 |
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Finance Act 2013, has introduced new section, namely Section 87A. This newly inserted section gives rebate up to maximum of Rs. 2000/- to the assesses having Net Total Income Less than Rs. 5,00,000/-(Rs. Five lacs only). The rebate under this section is available to the resident Individuals w.e.f. A.Y. 2014-15. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Conditions required to be fulfilled:
Quantum of Rebate: The rebate will be the lower of
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Impact on Tax liability: As a result of the above mentioned insertion in the Income tax Act by Finance Act 2013, resident individual both male and female having total income upto Rs. 2,70,000/- shall not be required to pay any tax. The impact of Section 87A on tax liability can be illustrated through the below examples:
Note: Rebate is based on Total income as highlighted in above table in bold and italics. *In example III no rebate is allowed as income exceeds Rs. 5 lacs. Above working are done on the basis of the Finance Bill 2014 applicable from the Assessment year 2015-16. |
Aug 122014