Income Tax Budget 2025 Live: Finance Minister Nirmala Sitharaman on Saturday said tax deductions at source (TDS) will be rationalised for senior citizens and doubled from Rs 50,000 to Rs 1 lakh.
FM Nirmala Sitharaman said: "I propose to rationalize tax deductions at source (TDS) by reducing the number of rates and thresholds about which TDS is deductible. Further, threshold amounts for tax deduction will be increased for better clarity and uniformity. The limit for tax deduction on interest for senior citizens is being doubled from the present Rs 50,000 to Rs 1,00,000."
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She added: "My tax proposals are guided by the spirit of promoting ease of doing business, encouraging voluntary compliance, and reducing the compliance burden. The objectives of these proposals include personal income tax reforms with a special focus on the middle class, rationalization of TDS and TCS to ease difficulties, and fostering employment and investment.
Sandeep Chilana, Managing Partner, CCLaw, said: “The increase in the TDS threshold for various payments is a welcome move to ease the compliance burden on smaller businesses and individuals. By raising the threshold for TDS on rental income, professional fees, and other such payments, the government aims to simplify tax filing for taxpayers with smaller incomes or fewer transactions. At the same time, the planned rationalization of TDS rates—by streamlining various categories into fewer, more uniform slabs—will significantly reduce confusion and compliance complexity across different sectors.”