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Know the process to claim the ₹50,000 standard deduction under Section 16(ia) of the Income Tax Act. Check who’s eligible, how it shows on salary/pension, key examples, and more.
Last updated on: April 29, 2026
The Income Tax Act, 1961, allows salaried individuals and pensioners to claim a standard deduction that helps reduce their taxable income and overall tax liability. This deduction is applied automatically and does not require submission of any bills or proofs, making tax filing simpler for both salaried earners and senior citizens.
Read on to learn what the income tax standard deduction is and the latest applicable limits under the current tax regime.
The standard deduction is a flat reduction applied to income. Originally reintroduced in 2018 at ₹40,000, this limit was increased to ₹50,000 from FY 2019–20 onwards.
Under the latest tax rules for FY 2024–25, the deduction structure is as follows:
Old Tax Regime: Standard deduction of ₹50,000 continues unchanged.
New Tax Regime:
You can claim this deduction regardless of expenditure on transport or medical allowance, as these exemptions were already subsumed into the standard deduction when it was reintroduced. The primary purpose of the standard deduction is to reduce tax burden, simplify compliance, and offer relief, especially to middle‑class salaried taxpayers and senior citizens.
If you are a salaried individual, you can claim an income tax standard deduction of ₹50,000 from your gross salary. To understand the deduction in a better way, check out this table.
| Particulars | Amount |
|---|---|
Gross Salary |
₹9,00,000 |
Transport Allowance (non-taxable) |
₹0 |
Medical Allowance (non-taxable) |
₹0 |
Standard Deduction |
₹50,000 |
Net Taxable Income |
₹8,50,000 |
Senior citizens who receive a pension are taxed under the income from salary, which makes them eligible for the standard deduction in the same way as salaried individuals. Earlier, the standard deduction available to all taxpayers, including senior citizens, was ₹50,000, a limit introduced from FY 2019–20 onward.
Under the latest income tax rules, the applicable standard deduction for senior citizens is:
₹50,000 under the Old Tax Regime (no change).
₹75,000 under the New Tax Regime, effective 1 April 2025 (AY 2025–26), as announced in Budget 2024.
This enhanced limit under the new regime applies to both salaried employees and pensioners, including senior citizens.
Unlike older interpretations, the deduction is no longer linked to the amount of pension received. Instead, senior citizens receive the full standard deduction applicable under the chosen tax regime, regardless of the pension amount.
The calculation of standard deduction in income tax is as per the stipulations and amendments.
Here is an example of how standard deduction has progressed:
| Particulars | FY 2022-23 (Old Regime) | FY 2022-23 (New Regime) | FY 2023-24 (New Regime) |
|---|---|---|---|
Basic Salary + Dearness Allowance |
₹10,00,000 |
₹10,00,000 |
₹10,00,000 |
Travel Allowance (non-taxable) |
₹0 |
₹0 |
₹0 |
Medical Allowance (non-taxable) |
₹0 |
₹0 |
₹0 |
Other Taxable Allowance |
₹1,50,000 |
₹1,50,000 |
₹1,50,000 |
Gross Salary |
₹11,50,000 |
₹11,50,000 |
₹11,50,000 |
Standard Deduction |
₹50,000 |
₹0 |
₹50,000 |
Total Income |
₹11,00,000 |
₹11,50,000 |
₹11,00,000 |
Other Deductions |
₹1,00,000 |
₹0 |
₹0 |
Income Chargeable to Tax |
₹10,00,000 |
₹11,50,000 |
₹11,00,000 |
You can claim income tax standard deduction while filing your tax return. Generally, employers consider your standard deduction while calculating your payable tax. This calculation helps your employer to deduct your Tax Deducted at Source (TDS).
You need to file the ITR before the due date announced by the Income Tax Department. In case there are any extensions on the last date to file the ITR, the IT department will notify about the same.
Check out other deductions that salaried individuals can benefit from.
Section 80C of the Income Tax Act offers a maximum deduction of ₹1.50 Lakhs on investments. In addition, Section 80CCC offers a deduction for an annuity plan of LIC or other insurance companies.
Under Section 80D, you can claim a deduction of ₹25,000 on insurance for yourself, spouse, and dependent children. Also, an additional deduction of ₹25,000 is available for parents’ insurance if they are below 60 years and ₹50,000 if they are above 60 years.
Section 80E allows you to claim deductions on interest that you pay during the repayment of education loans for higher studies. This deduction is applicable whether you availed the loan for your spouse, children, or a student for whom you are a legal guardian.
Senior citizens can still claim several deductions under the Old Tax Regime, as these fall under Chapter VI‑A, which is not available under the New Tax Regime. Here are other deductions for senior citizens or pensioners.
According to Section 80D, senior citizens can avail of ₹50,000 on the payments of health insurance premiums.
Section 80TTB offers a deduction of up to ₹50,000 for senior citizens on interest from bank accounts and deposits, post office deposits, and deposits with NBFCs.
Section 80DDB allows a deduction of up to ₹1 Lakh for senior citizens for medical treatment. These include some specific ailments and diseases.
With this information in hand, you can claim standard deduction income tax and other deductions to save on taxes.
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Reviewer
Yes, pensioners are eligible for the standard deduction just like salaried employees, with the deduction fixed at ₹50,000 under the Old Tax Regime and ₹75,000 under the New Tax Regime starting AY 2025–26, as enhanced in Budget 2024, making pensioners fully entitled to the updated deduction limits depending on the regime they choose.
Yes, you can claim both Section 80C deductions and the standard deduction, but only under the Old Tax Regime, since the New Tax Regime does not permit Section 80C or most other Chapter VI‑A deductions, even though it does allow the standard deduction.
No, you cannot claim separate medical or transport allowances along with the standard deduction because these exemptions were merged into the standard deduction when it was reintroduced in 2018, meaning the standard deduction replaces these individual allowances under all tax regimes.
No, you cannot claim the ₹50,000 standard deduction for periods before FY 2019–20, since the deduction was increased from ₹40,000 to ₹50,000 starting only from FY 2019–20 onward, and the law does not permit revising earlier returns to apply this updated deduction.
The standard deduction was ₹40,000 in FY 2018–19 and increased to ₹50,000 from FY 2019–20 onward, but under the New Tax Regime the deduction rises further to ₹75,000 from AY 2025–26, reflecting the enhancement announced in Budget 2024.
Under the provisions of the Income Tax Act, 1961, you get a standard deduction of ₹50,000. It is deducted from your total taxable income while you file your tax return.
You can claim the standard deduction irrespective of your salary amount.
No, if you are a salaried employee, you do not need to provide proof to claim the standard deduction.
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