The Standard Deduction is a flat deduction available to every salaried individual and pensioner under the New Tax Regime. Budget 2024 increased this from ₹50,000 to ₹75,000, making the New Regime more attractive. No bills, no proofs — it is automatically applied before computing your taxable income.
Who Can Claim
- All salaried employees (private and government)
- Pensioners receiving pension from a former employer
- Family pension recipients (separate deduction — see Family Pension page)
- Available automatically — no declaration or proof required
Key Details
- Flat deduction of ₹75,000 from gross salary income
- Increased from ₹50,000 to ₹75,000 in Union Budget 2024 (applicable from FY 2024-25)
- Combined with the ₹12 lakh 87A rebate (Budget 2025), effectively zero tax up to ₹12.75 lakh gross salary
- Available in both Old Regime (₹50,000) and New Regime (₹75,000)
- Applies once — not multiplied by number of employers if you switch jobs
Example
- Gross Salary: ₹12,75,000
- Less: Standard Deduction: ₹75,000
- Net Taxable Income: ₹12,00,000
- Tax on ₹12,00,000: ₹60,000 (as per new regime slabs)
- Less: 87A Rebate: ₹60,000
- Final Tax Payable: ₹0
This guide reflects FY 2025-26 (AY 2026-27) and is for general information. Tax rules and limits change, and how they apply depends on your circumstances. It is not professional tax advice; consult a qualified Chartered Accountant before acting.
