Rebate u/s 87A is allowed from the amount of income tax. This section is inserted by finance act 2013 and is applicable from financial year 2013-14.
Eligible Person – Individual resident in India whose total income does not exceed Rs. 5,00,000.
Eligible Amount – 100% of income tax or rs. 2,000 (Rs. 5,000 from financial year 2016-17) whichever is less. Rebate is allowed before levy of Education cess, secondary and higher education cess & Surcharge.
This cannot be said that the exemption limit is increased by Rs. 20,000/Rs. 50,000 because this benefit is not available to assessees whose total income exceeds Rs. 5,00,000.
Although rebate is allowed to senior citizens. Super senior citizens does not get any benefit because their exemption limit is already Rs. 5,00,000.