Rebate under Section 87A of Income Tax Act,1961
The rebate under section 87a is available only to individual assessee and not to members of Hindu United Families, AOP/BOI, Firm and Company. Also, the aggregate amount of rebate should not exceed the amount of income tax computed before the rebate on total income of the individual with which they are chargeable for that assessment year.
| S. No. | Financial Year | Rebate |
| 1 | 2017-18 | 2,500/- |
| 2 | 2016-17 | 5000/- |
| 3 | 2015-16 | 2000/- |
| 4 | 2014-15 | 2000/- |
| 5 | 2013-14 | 2000/- |
Few Examples to understand rebate u/s 87A on Income Tax:
| Total Income | Tax payable before cess | Rebate u/s 87A (max allowable) | Tax Payable + education cess |
| 2,75,000 | 1,250 | 1,250 | 0 |
| 3,00,000 | 2,500 | 2,500 | 0 |
| 3,25,000 | 3,750 | 2,500 | 1,250+37.5 |
| 3,50,000 | 5,000 | 2,500 | 2,500+75 |
Key Points of Section 87A of the Income Tax Act, 1961:
Listed below are the key points of Section 87A of the Income Tax Act, 1961.
Amended section 87A is applicable from 1st April of that financial year, it is applicable to the assessment year and its subsequent assessment years
Maximum Rebate amount Rs. 5000 (Rs. 2500 from F.Y 2017-18)
Only Indian residents can avail the rebate, NRIs are not eligible for the rebate
Both male and female assesses are eligible for the rebate
Rebate benefit is not available to super senior citizens
This rebate is deducted from total tax before adding Education Cess(3%).
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