Budget 2025 Explained: Key Highlights and Announcements

On 1st February 2025, the Finance Minister presented the Union Budget 2025, where a few major changes have been made, which you as a women investor should know. In this blog, we’ll go through key budget 2025 highlights.

Let’s first understand what is the Union budget,

What is the Union Budget?

The Union Budget is an annual financial statement that details its receipts and expenditures for the financial year. Just as you create a personal budget to manage your income and expenses, the Union Budget is a comprehensive budget plan for the entire country. It outlines tax reforms, financial initiatives, growth plans, and expenditure on social welfare.

Focus of Union Budget 2025:

This budget is dedicated to 

1. Accelerating growth
2. Securing inclusive development 
3. Boosting private sector investments
4. Uplift household sentiments, and 
5. Enhancing spending power of India’s rising middle class. 

Also, in this Budget, the proposed development measures span ten broad areas focusing on Garib, Youth, Annadata and Nari.

Key Budget 2025 Announcements:

Tax-Related Announcements:

TDS & TCS Threshold Increased:

• Senior Citizens: The limit for a tax deduction on interest for senior citizens is being doubled from the present “50,000” to “1 lakh”
• TDS on Rent: The annual TDS limit on rent increased from ₹2.4 lakh to ₹6 lakh.
• TCS on Remittances: The threshold for TCS on remittances under the RBI’s Liberalized Remittance Scheme (LRS) (It is a scheme that allows Indian residents to send money abroad for various purposes) is increased from ₹7 lakh to ₹10 lakh.
• Education Remittances: TCS on remittances for education purposes will be removed if the remittance is from a loan taken from a specified financial institution.

Income Tax Changes under New Tax Regime:

• No income tax payable up to ₹12 lakh under the new tax regime (excluding special rate income like capital gains).
• This limit increases to ₹12.75 lakh for salaried taxpayers due to a standard deduction of ₹75,000.

Income Tax Slab Rates Changed for New Tax Regime:

• Example of how these slab rates will help you save tax- 
  • A taxpayer earning ₹12 lakh will benefit by ₹80,000
  • A person earning ₹18 lakh will benefit by ₹70,000
  • A person earning ₹25 lakh will benefit by ₹1,10,000 

The time limit is extended to file the updated return:

• The time limit to file the updated return is extended from the existing 24 months i.e. 2 years to 48 months i.e. 4 years from the end of the relevant assessment year. 

Note: All new tax changes will be applicable for FY2025-26. And there are no tax changes under the old tax regime.

If you wish to invest in tax-saving mutual funds i.e. ELSS which offers tax deduction under section 80C up to the limit of ₹1.5 Lakh under the old tax regime, then check out Lxme app- investment for women and look out for well-researched and expert-curated tax saving mutual fund portfolio.

KYC Related Announcement:

KYC Simplification: 

• New Central KYC Registry to be launched in 2025
• Simpler KYC process for easier verification
• Streamlined system for hassle-free periodic updates

Women-Related Announcements:

1. Scheme for First-time Entrepreneurs:
   1. Target Group: 5 lakh women, Scheduled Castes (SC) and Scheduled Tribes (ST) first-time entrepreneurs
   2. Loan Amount: Up to ₹2 crore will be provided during the next 5 years
   3. Additional Support: Online training for entrepreneurship & managerial skills
2. The Saksham Anganwadi and Poshan 2.0 program provides nutritional support to over 8 crore children, 1 crore pregnant women and lactating mothers, and around 20 lakh adolescent girls in aspirational districts and the Northeast. The cost norms for this nutritional support will be increased.

General Announcements of the Budget 2025:

Govt Push for Nutrition & Healthy Eating:

A program will be announced to boost vegetable and fruit availability, supporting rising nutrition awareness and healthier food choices.

Major Boost for MSMEs (Micro, Small and Medium Enterprises):

The government will support 5.7 crore MSMEs, including 1 crore+ registered businesses employing 7.5 crore people and contributing 36% to manufacturing and 45% to exports. To drive growth, MSME investment and turnover limits will increase 2.5x and 2x, enabling expansion, innovation, and job creation.

Medical Education Expansion:

Over the past 10 years, UG and PG medical seats have increased by 130%, adding 1.1 lakh seats. Next year, 10,000 more seats will be added, with a goal of 75,000 new seats in the next 5 years.

Boosting Tourism Infrastructure:

Top 50 tourist destinations will be developed in partnership with states, which must provide land for key infrastructure. Hotels in these locations will be included in the infrastructure HML (Harmonized Master List).

India to Become a Toy Hub:

A national action plan for toys is announced, focusing on developing clusters, skills, and a manufacturing ecosystem to create high-quality, innovative, and sustainable ‘Made in India’ toys.

Capex target for FY25:

The Capital expenditure target has been cut to ₹10.18 lakh crore from ₹11.1 lakh crore.

Conclusion

These are union budget 2025 highlights that you as a women taxpayer and investor should know as it will impact you while paying taxes. It’s essential to understand how these updates can influence your financial planning. The government’s substantial allocations for women-led development highlight the importance of empowering women economically. As women investors, staying informed about these changes allows you to make better financial decisions, whether it’s optimizing your tax liabilities or planning your investments. 

FAQs

Further Read,

• Effects of Inflation on Women and how to tackle it?
• Financial Planning for Women Entrepreneurs
• Inspiring Stories of Women in Finance