Budget 2024: What the salaried and the self-employed expect from the budget | Simply Save

The February 1, 2024 Budget will be an interim budget before this year’s general elections. While taxpayers shouldn’t expect any big bang measures, some small tax sops cannot be completely ruled out. Moneycontrol reached out to experts and individual taxpayers to understand what the salaried and the self-employed expect from the coming budget.

To listen to the podcast, click above. To read the podcast conversation, scroll down.

With February 1 less than a month away, the countdown to Budget 2024 has begun. Since this will be a vote-on-account or an interim budget ahead of the general elections, should taxpayers expect no big bang measures? Speaking at a CII event in December 2023, the Finance Minister said that there would be no spectacular announcements in this budget. But, will there be any small surprises? Only time will tell.

In the meanwhile, Moneycontrol reached out to chartered accountants, financial advisors and tax-payers to understand what the salaried and the self-employed expect from the budget and which of these wishes are likely to be granted.

Here are a few important points discussed in the podcast:

-Normally, governments refrain from making major announcements in an interim budget but some sops for taxpayers cannot be completely ruled out. For example, in the 2019 interim budget, the government announced a tax rebate for those with incomes of up to Rs 5 lakh. As a result, even those with incomes of up to Rs 7 lakh would have to pay no tax if they claimed deductions worth Rs 2 lakh including standard deduction.

-Budget 2024 wish list of the salaried class – As with every year, the salaried class is hoping for an increase in the basic exemption limit under both the old and the new tax regimes. They would also like key tax breaks such as the HRA (house rent allowance) exemption, home loan interest deduction and health insurance premium deduction to be included under the new tax regime, too.

-Budget 2024 wish list of the self-employed – The self-employed wish to have greater flexibility on switching between the old and the new tax regime. Unlike salaried individuals who can make this choice every financial year, the self-employed can make this switch only once in their lifetime. Given that the latter can have fluctuating incomes from year to year, this flexibility would be helpful.

-Expectations on presumptive taxation – Self-employed individuals (businesses and select professionals) with annual turnover / gross receipts of up to a certain amount can opt for presumptive taxation to save themselves from the hassle of maintaining books of accounts. Tax experts say bringing some other smaller self-employed professionals too, under presumptive taxation could be beneficial for such taxpayers.

-What tax experts and industry watchers expect – They say an increase in the basic exemption limit looks very unlikely for either of the tax regimes. Home loan borrowers is one category of individuals that has been reluctant to move from the old to the new tax regime so as to not lose the home loan interest deduction allowed under Section 24 of the Income Tax Act. Some tweaks in this to encourage more people to shift to the new tax regime may perhaps be considered in the budget.