Top 10 Union Budget 2017 Impact on Individuals

The Union Budget 2017 was a budget focused on providing the relief to the middle-class individual taxpayers. Let’s see what  Arun Jaitley’s Union Budget 2017 had for the individuals.

1. Zero Tax Liability:

Arun Jaitley announced zero tax liability on the individuals earning an income up to Rs.3 Lakhs [after taking advantage of rebate u/s 87A].


2. Reduction in slab Rate:

The existing slab rate of 10% reduced to 5% for the individuals earning income from Rs.2.5 Lakhs- Rs.5 Lakhs.


3. Change in The Rebate u/s 87A:

The existing rebate under section 87A is reduced to Rs.2500 for individuals earning income up to Rs.3.5 Lakhs.


4. No Tax Up to income of Rs 4.5 Lakhs:

Arun Jaitley in his speech mentioned no tax liability for people earning income up to 4.5 Lakhs

(Exemption amount = 2.5 lakh  +  Deductions u/s 80C =  1.5 lakh  +  Rebate u/s 87A on the Tax Liability =Rs.2500 )


5. Capital Gains Amendments:

  • For calculation of Long Term capital Gains-

The holding period for land & building will be reduced to 2 yrs from 3 yrs.

  • Base year indexation shifted from 1.4.1981 to 1.4.2001 (From Cost Inflation Index 100 to 426)

6. Surcharge Introduced:

Earlier only 15% surcharge was applicable on income exceeding Rs. 1cr. Now 10 % surcharge is also applicable on income above Rs 50 lakh and up to Rs 1 cr.


7. Simple ITR Form:

The introduction of simple one -page return form for individuals having income up to Rs.5 Lakhs.


8. No TDS for Insurance Commission Agents:

Exemption from the TDS @5% to the insurance agents submitting a declaration of earning income below taxable limit.


9. Cash Donations:

The limit of donations in cash to charitable institutions reduced from Rs 10000 to Rs.2000.


10. No cash Transactions:

Transactions exceeding Rs 3 lakh will not be permitted in cash.
All the above changes shall be applicable from F.Y.2017-18.
Source: Live Budget Updates

CA Abhishek Soni

By CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.

2 comments

    1. To help individual taxpayers in lowering the tax burden, Section 87A was introduced. Previously a Resident individual, whose total income does not exceed Rs. 5 lakh is entitled to a deduction of Rs 5000 from the amount of income-tax after allowing the deduction. To know how much rebate you are entitled post budget, use our budget income tax calculator. https://tax2win.in/budget-2017-impact

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