ITR Application 2025: Can you ask for FY24 income tax of Rs 2,500, Rs 25,000 or Rs 60,000?
With the closing date of filing an Income Tax Return (ITR) approaching, taxpayers are confused about the status of the discount under Section 87A of the Income Tax Act. One of the main reasons for this is the 2025 budget announcement, which attempts to increase the rebate to Rs 60,000. However, it does not apply during the current ITR application season.
What is ITR kickback?
ITR rebates are the reduction of the total tax amount to be paid after calculating income tax liability. It’s like the final discount offered by the government is to relieve your tax burden, but only if your income falls under specified limits. The most commonly used discount is under Section 87A, which benefits small taxpayers. Determine the total tax based on your income board, which will deduct this rebate and reduce your final tax liability to zero.
What is Section 87A
Section 87A of the Income Tax Act provides rebates for taxes payable, rather than income. condition? Your total taxable income should be below the specified limit. In fiscal year 2024-25, if you report income below Rs 5 lakhs according to the old system, your rebate is Rs 12,500. If you choose the new system and you earn up to Rs 7 lakh, you are entitled to a rebate of Rs 25,000. Residents can use rebates and deduct them after your taxes are collected instead of before.
What rebates are there now?
You are currently submitting an ITR for your fiscal year revenue 2024-25 (Assessment Year 2025-26). The rules applicable here are based on budget 2024, not budget 2025.
Here is the Section 87A you can actually ask for this year:
Here is a small, clean table that summarizes Section 87A Rebate (AY 2025-26):
| Tax system | Applicable FY (AY) | Total rebate income limit | Maximum rebate |
|---|---|---|---|
| Old tax system | Fiscal Year 2024-25 (AY 2025–26) | Up to Rs 5,00,000 | Rs 12,500 |
| New tax system | Fiscal Year 2024-25 (AY 2025–26) | Up to Rs 7,00,000 | Rs 25,000 |
Rs 60,000 rebate? That’s next year
Rs 60,000 rebate under Article 87A announced in the 2025 budget only applies to revenues in fiscal 2025-26. You will ask for it when submitting your return for 2026-27 next year.
Before that, under the old system, the current limit was insisted on Rs 12,500 and Rs 25,000 under the new regime.
What if your income is slightly above Rs 7 lakh?
The new regime also provides marginal relief. If your total income is slightly less than Rs 700,000 and the tax payable exceeds Rs 7 lakh extra income, you can still ask for a refund of excess tax equal to Rs 7 lakh income. This ensures that you don’t lose all the benefits by earning a few rupees.
