Finance Boosan

https://youtu.be/zttnS4GZarg

💬 Share it with someone who needs to know this—especially if they’re close to ₹12L income!

This means that after applying marginal relief, you pay just ₹25,000—the exact amount of your extra income—saving you over ₹40,000 in tax! Why Does This Matter? The difference between ₹12L and ₹13L income could cost you a lot more tax than you expected. Understanding how Marginal Relief works can help you save money and avoid overpaying.

Step 1: Net Taxable Income Calculation 💼 Gross Income = ₹13,00,000 🔹 Standard Deduction = ₹75,000 After applying the standard deduction, your net taxable income becomes: 💰 ₹13,00,000 - ₹75,000 = ₹12,25,000 Now, since your taxable income exceeds ₹12L, you lose the ₹12L rebate and will have to pay tax on the full ₹12,25,000 instead of ₹12,00,000. Step 2: Tax Calculation Using New Regime Slabs Let’s calculate the tax for ₹12,25,000 taxable income: (refer slab rate image) Total Tax (Before Cess) ₹63,750 + 4% Cess ₹2,550 Total Tax Payable ₹66,300 ⚠️ That’s ₹66,300 in tax! And this is for earning just ₹25,000 extra! It doesn’t seem fair, right? Step 3: How Marginal Relief Saves You! That’s where Marginal Relief comes in. This relief ensures you don’t pay more tax than the extra income you earned after crossing ₹12L. Here’s how it works: Excess Tax = ₹66,300 Excess Income = ₹25,000 Thanks to Marginal Relief, you’ll only pay tax on ₹25,000 (your additional income) instead of ₹66,300! Final Tax Payable with Marginal Relief = ₹25,000! 🙌

🚨 ₹12L Income = ₹0 Tax, But ₹13L Could Mean ₹66,300 Tax! Yes, you read that right! If your taxable income crosses ₹12L, you could be paying a significant amount of tax even if your extra earnings are just ₹25,000. But don't worry—there's a way to reduce that extra tax! Let’s break it down. 👇