Budget 2024: The Finance Minister of India Nirmala Sitharaman announced a plan to increase the family pension deduction amount for the better financial stability of the four crore salaried individuals and pensioners, according to the budget announcement on July 23.
The deduction amount is proposed to be increased to ₹25,000 from ₹15,000, under the new tax regime, according to the Budget announcement.
“Deduction on family pension for pensioners is proposed to be enhanced from ₹15,000 to ₹25,000," as per the Budget announcement. This move along with the standard deduction for salaried employees will provide relief to about four crore salaried individuals and pensioners, according to the Finance Minister's statement.
“The standard deduction for salaried employees is proposed to be increased from ₹50,000 to ₹75,000,” said Nirmala Sitharaman in the budget address.
The government also proposed to increase the amount of deduction which is allowed to an employer for a pension scheme referred to in section 80CCD. The goal is to increase it to 14 per cent of the salary from the current value of 10 per of the salary received by an employee.
In the case of a private employee under the new tax regime, the deduction amount will not be allowed to exceed 14 per cent of the salary of the employee in place of 10 per cent, as per the new announcement in the Budget.
“New Income Tax Scheme relaxations in standard deduction, slabs reduction and family pension deduction relaxation may help in savings of around Rs.35,000 per taxpayer,” said Vivek Jalan, Partner Tax Connect, a pan-India multidisciplinary firm.
Mint reported earlier, that the Department of Pensions and Pensioners' Welfare (DoPPW) allowed women employees and pensioners to nominate their children for receiving the family pension over their spouse, as per a report released in January.
