{"id":7132,"date":"2025-06-26T12:57:02","date_gmt":"2025-06-26T12:57:02","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/?post_type=glossary&#038;p=7132"},"modified":"2025-06-26T12:57:12","modified_gmt":"2025-06-26T12:57:12","slug":"section-87a","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/section-87a\/","title":{"rendered":"Section 87A"},"content":{"rendered":"<p><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/section-87a\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Section 87A<\/a> of the <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/income-tax-act\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Income Tax Act<\/a> is a <strong>special rebate<\/strong> that helps <strong>small <a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/tax\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>tax<\/a>payers<\/strong> save money on their tax bills. If your income is under a certain limit, you can get a full rebate and <strong>pay zero <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/income-tax\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">income tax<\/a><\/strong>. Let&#x2019;s break it down in simple language.<\/p>\n\n\n\n<h2 id=\"what-is-section-87a\" class=\"wp-block-heading\">What is Section 87A?<\/h2>\n\n\n\n<p>Section 87A is a provision in the Income Tax Act that offers a <strong>rebate (reduction)<\/strong> on your total income tax if your income is within a certain limit. This rebate is directly subtracted from the <strong>tax you owe<\/strong>, not from your income.<\/p>\n\n\n\n<h2 id=\"applicable-for-financial-year-2024-25-assessment-year-2025-26\" class=\"wp-block-heading\">Applicable for: <strong>Financial Year 2024-25<\/strong> (Assessment Year 2025-26)<\/h2>\n\n\n\n<h2 id=\"who-can-claim-the-rebate\" class=\"wp-block-heading\">Who Can Claim the Rebate?<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>You must be a <strong>resident individual<\/strong> (not Hindu Undivided Family or company)<\/li>\n\n\n\n<li>Your <strong>total income<\/strong> (after deductions) must be <strong>within &#x20B9;7 lakh<\/strong> under the <strong>new tax regime<\/strong><\/li>\n\n\n\n<li>Or within <strong>&#x20B9;5 lakh<\/strong> under the <strong>old tax regime<\/strong><\/li>\n<\/ul>\n\n\n\n<h2 id=\"how-much-rebate-do-you-get\" class=\"wp-block-heading\">How Much Rebate Do You Get?<\/h2>\n\n\n\n<h3 id=\"under-new-tax-regime\" class=\"wp-block-heading\">Under <strong>New Tax Regime<\/strong>:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If your <strong>total income is &#x20B9;7 lakh or less<\/strong>, you get a <strong>rebate of up to &#x20B9;25,000<\/strong><\/li>\n\n\n\n<li>This means you <strong>don&#x2019;t pay any income tax<\/strong><\/li>\n<\/ul>\n\n\n\n<h3 id=\"under-old-tax-regime\" class=\"wp-block-heading\">Under <strong>Old Tax Regime<\/strong>:<\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>If your <strong>total income is &#x20B9;5 lakh or less<\/strong>, you get a <strong>rebate of up to &#x20B9;12,500<\/strong><\/li>\n\n\n\n<li>Again, you end up paying <strong>zero tax<\/strong><\/li>\n<\/ul>\n\n\n\n<h2 id=\"summary-table\" class=\"wp-block-heading\">Summary Table<\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><thead><tr><th>Tax Regime<\/th><th>Income Limit for Rebate<\/th><th>Maximum Rebate<\/th><th>Net Tax Payable<\/th><\/tr><\/thead><tbody><tr><td>New Regime<\/td><td>&#x20B9;7,00,000<\/td><td>&#x20B9;25,000<\/td><td>&#x20B9;0<\/td><\/tr><tr><td>Old Regime<\/td><td>&#x20B9;5,00,000<\/td><td>&#x20B9;12,500<\/td><td>&#x20B9;0<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 id=\"simple-example\" class=\"wp-block-heading\">Simple Example<\/h2>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Rahul earns &#x20B9;6.8 lakh annually and chooses the new tax regime<\/strong>:\n<ul class=\"wp-block-list\">\n<li>He qualifies for the &#x20B9;25,000 rebate under Section 87A<\/li>\n\n\n\n<li>He <strong>pays zero tax<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Priya earns &#x20B9;5.2 lakh under the old regime<\/strong>:\n<ul class=\"wp-block-list\">\n<li>She <strong>doesn&#x2019;t qualify<\/strong> as her income is above &#x20B9;5 lakh<\/li>\n\n\n\n<li>She must pay tax after applicable deductions<\/li>\n<\/ul>\n<\/li>\n<\/ol>\n\n\n\n<h2 id=\"key-points-to-remember\" class=\"wp-block-heading\">Key Points to Remember<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>This <strong>rebate is only for individuals<\/strong>&#x2014;not for HUFs, companies, or firms<\/li>\n\n\n\n<li>It applies <strong>after deductions<\/strong> like 80C, 80D etc. in the old regime<\/li>\n\n\n\n<li>The rebate is <strong>not a refund<\/strong>, it&#x2019;s a <strong>tax reduction<\/strong><\/li>\n\n\n\n<li>If your income exceeds &#x20B9;7 lakh (new regime), even by &#x20B9;1, you lose the full rebate&#x2014;unless marginal relief applies<\/li>\n<\/ul>\n\n\n\n<h2 id=\"conclusion\" class=\"wp-block-heading\">Conclusion<\/h2>\n\n\n\n<p>Section 87A is a great benefit for low and middle-income taxpayers. It rewards those who earn within the set limit by giving a full tax break. By understanding and planning your income and deductions wisely, you can save tax legally and efficiently.<\/p>\n\n\n\n<p>Let me know if you want a visual ve<a class=\"glossaryLink\"  href=\"https:\/\/lemonn.co.in\/blog\/glossary\/rsi\/\"  data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]'  tabindex='0' role='link'>rsi<\/a>on or a calculator added!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Section 87A of the Income Tax Act is a special rebate that helps small taxpayers save money on their tax bills. If your income is under a certain limit, you can get a full rebate and pay zero income tax. Let&#x2019;s break it down in simple language. What is Section 87A? Section 87A is a [&#x2026;]<\/p>\n","protected":false},"author":9,"featured_media":0,"menu_order":0,"template":"","meta":{"footnotes":""},"class_list":["post-7132","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7132","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/9"}],"version-history":[{"count":1,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7132\/revisions"}],"predecessor-version":[{"id":7133,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/7132\/revisions\/7133"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=7132"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}