What this means is the benefit is applicable only to those whose earnings are under Rs 5 lakh but not more than that. Also, those earning less than Rs 5 lakh will have to pay tax initially and seek a rebate while filing their returns.
Here's a quick review of the income tax relief announced by FM Goyal to clear any confusions over whether it was an exemption or rebate The rebate under Section 87A of the Income Tax Act has been enhanced to Rs 12,500 from Rs 2,500 earlier. The threshold has also been enhanced to income of Rs 5 lakh from Rs 3.5 lakh earlier. This will benefit taxpayers only to the extent of an annual income of Rs 5 lakh. The basic exemption limit and tax-slabs remain the same