Last Modified: Mon, Feb 05 2018. 12 53 AM IST

What the new standard deduction means

The Union Budget 2018 has proposed to re-introduce standard deduction for salaried individuals. Here is how it would impact your tax outgo

Photo: Hemant Mishra/Mint
Staff Writer

At present an individual can claim tax-free transport allowance of up to Rs1,600 per month and medical reimbursements of up to Rs1,250 per month. Together, these two allowances currently amount to a maximum of Rs34,200 a year. Considering that the proposed standard deduction is in lieu of these two, which are currently available, the net increase in deduction would be a maximum of Rs5,800. This would help an individual in the highest tax bracket to save up to Rs1,810 in terms of tax outgo.

Topics: standard deductionbudget 2018salaried individualallowance

First Published: Mon, Feb 05 2018. 12 53 AM IST

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