Choosing Between Old And New Income Tax Regimes? 5 Things To Consider
Here are 5 things to consider if you are stuck between the dilemma of chosing between new and old tax regime.
Here are 5 things to consider if you are stuck between the dilemma of chosing between new and old tax regime.
Old Or New Tax Regime: Which One To Choose?
Choice between the new and old tax regime is completely dependent on individuals based on their investment instruments and how they want their ITR tailor made for their preference. However, you could consider these 5 things when comparing new and old tax regime. This is not an expansive list, but can give you an idea while you sit to compare both the tax regime.
1. Deductions
2. Standard Deductions
3. Exemptions
4. Different Tax Slabs
The calculation of taxes under both regimes is different due to the difference between their tax slabs. In New tax regime, as per the latest Budget 2024 announcement there is zero tax on 0 to Rs 3 lakhs, 5% tax on income up to Rs 3-7 lakh, 10% tax on income up to Rs 7-10 lakh, 15% tax on income up to Rs 10-12 lakh, 20% tax on income up to Rs 12-15 lakh and 30% tax on income above Rs 15 lakh under the new tax regime.
Old Tax Regime Tax Slab
Up to Rs 3,00,000: Nil (Income Tax Rate)
Rs 3,00,001 - Rs 5,00,000: 5% above Rs 3,00,000 (Income Tax Rate)
Rs 5,00,001 - Rs 10,00,000: Rs 10,000 + 20% above Rs 5,00,000 (Income Tax Rate)
Above Rs 10,00,000: Rs 1,10,000 + 30% above Rs 10,00,000 (Income Tax Rate)