Question

What is tax rebate?

Answer 1

A tax refund or tax rebate is a refund on taxes when the tax liability is less than the taxes paid. Taxpayers can often get a tax refund on their income tax if the tax they owe is less than the sum of the total amount of the withholding taxes and estimated taxes that they paid, plus the refundable tax credits that they claim. (Tax refunds are often paid after the end of the tax year.)

Answer 2

Income Tax Rebate under section 87A

Rebate under section 87A provides for a marginally lower payment of tax to individuals earning income below the specified limit. It is being provided to reduce the tax burden of lower income bracket.

In FY 2018-19 and 2017-18, an individual can claim a maximum rebate of Rs. 2,500 each year.