rewrite this title and make it good for SEOITR Filing 2025: Can you claim Rs 12,500, Rs 25,000 or Rs 60,000 in Income Tax for FY24?

With the due date for filing income tax return (ITR) approaching, taxpayers are in a state of confusion regarding the rebate under Section 87A of the Income Tax Act. One of the main reasons for this is the last budget 2025 announcement, which had sought to raise the rebate to Rs 60,000. But, it does not apply during the current ITR filing season.

What is ITR Rebate?

An ITR rebate is a reduction in your total tax payable after you’ve calculated your income tax liability. It is like a final discount offered by the government to reduce your tax burden, but only if your income falls within a specified limit. The most commonly used rebate is under Section 87A, which benefits small taxpayers. After your total tax is determined according to your income slab, this rebate is deducted, reducing your ending tax liability at times to zero.

What is Section 87A

Section 87A of the Income Tax Act provides a rebate in tax payable, not in income. The condition? Your aggregate taxable income should be below a limit specified. In FY 2024-25, if you are reporting under the old regime and your income is below Rs 5 lakh, you receive a rebate of Rs 12,500. If you choose the new regime, and your income is up to Rs 7 lakh, you’re entitled to a rebate of Rs 25,000. The rebate can be availed by resident individuals and will be deducted after arriving at your tax, and not before.

What rebate is available now?

You are currently filing your ITR for income earned during the financial year 2024-25 (Assessment Year 2025-26). The rules applicable here are based on Budget 2024, not Budget 2025.

Here’s the Section 87A rebate you can actually claim this year:

Here’s the small, clean table summarising the Section 87A rebate for FY 2024-25 (AY 2025-26):

Tax Regime
Applicable FY (AY)
Total Income Limit for Rebate
Maximum Rebate

Old Tax Regime
FY 2024–25 (AY 2025–26)
Up to Rs 5,00,000
Rs 12,500

New Tax Regime
FY 2024–25 (AY 2025–26)
Up to Rs 7,00,000
Rs 25,000

Rs 60,000 rebate? That’s for next year

The Rs 60,000 rebate under Section 87A announced in Budget 2025 will apply only to income earned in FY 2025-26. You will be able to claim it next year while filing returns for AY 2026-27.

Until then, stick to the current limits Rs 12,500 under the old regime and Rs 25,000 under the new regime.

What if your income slightly exceeds Rs 7 lakh?

The new regime also offers marginal relief. If your total income slightly crosses Rs 7,00,000 and the tax payable exceeds the additional income above Rs 7 lakh, you can still claim a rebate equal to the excess tax over Rs 7 lakh income. This ensures you don’t lose all benefits for earning just a few rupees more.