Is rebate available 87A

This query is : Resolved

Daya (Querist)
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10 November 2024 is rebate of income tax available for individual
under New regime and old regime for FY 2024-25
what is l;init under both the regime.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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10 November 2024 New Tax Regime
Rebate Limit: Individuals with a total taxable income of up to ₹7,00,000 can claim a rebate under Section 87A. The rebate amount is the lower of: The total income tax payable, or ₹25,000.
This means that if your taxable income is ₹7,00,000 or less, you effectively pay no tax due to this rebate.
Old Tax Regime
Rebate Limit: For individuals opting for the old tax regime, the rebate is available for those with a taxable income of up to ₹5,00,000. The rebate amount is: The lower of the total income tax payable or ₹12,500.
Therefore, if your taxable income does not exceed ₹5,00,000, you can claim a full rebate, resulting in zero tax liability,

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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08 December 2024 The case of **Beena Manishbhai Fofaria vs. CIT (Appeals)** revolves around the application of **Section 87A** of the Income Tax Act, especially after the amendments brought by the Finance Act, 2023.

In this case, the taxpayer filed her return for the Financial Year 2023-24, declaring a total income of Rs. 6,93,260, which included short-term capital gains (STCG) of Rs. 65,066. She claimed a rebate of Rs. 20,010 under Section 87A, as her total income was under Rs. 7,00,000. However, the Centralized Processing Centre (CPC) restricted the rebate to Rs. 10,250, disallowing the rebate on STCG. This led to a reduced refund amount, prompting the taxpayer to file an appeal.

The CIT (Appeals) ruled in favor of the taxpayer, stating that the Finance Act, 2023, permits a rebate on total income (excluding long-term capital gains taxed under Section 112A) if the total income is within Rs. 7,00,000. The ruling confirmed that short-term capital gains are eligible for the rebate if the total income is under Rs. 7,00,000.

This case is significant as it clarifies the application of Section 87A and benefits many taxpayers.

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