Budget 2014: Tax savings of Rs 20,000 in highest tax slab

NEW DELHI: Taxpayers in the 30% bracket stand to save up to Rs 20,000 a year in tax due to the changes announced in the budget. The raising of the basic exemption limit by Rs 50,000 will save Rs 5,000 in tax. The Rs 50,000 increase in the investment limit under Section 80C will let them save another Rs 15,000.

For those earning up to Rs 10 lakh a year, the potential savings will be lower at Rs 15,000. And those earning up to Rs 5 lakh a year will be able to save up to Rs 10,000 in tax. And that too if they can find the additional Rs 50,000 to invest in Sec 80C options.

The finance minister also announced additional tax benefits to home loan customers, increasing the deduction from Rs 1.5 lakh to Rs 2 lakh a year. If they have a home loan and are availing tax benefits, taxpayers in the highest tax slab can save an additional Rs 15,000 in tax. Those earning up to Rs 10 lakh a year can save Rs 10,000, while those in the lowest tax slab stand to reduce their outgo by Rs 5,000.