Budget 2020 proposed, lesser tax liabilities, Housing Loan, Standard Deduction, Travelling Allowance

Budget 2020 proposed a new optional tax regime with reorganised tax slabs and hope for lesser tax liabilities. The new budget has also decreased 70 tax exemptions which were being enjoyed by us earlier.

Taxpayers get the options to choose either the old tax regime or the new tax regime with their own pros and cons.

New tax regime comes with a rider to forego various exemptions being provided under the old regime like 80C, 80D, Housing Loan, Standard Deduction, Travelling allowances, etc.

Following are certain computations for a better understanding of the benefit or loss by the new regime

		Old Regime		New Regime		Tax Benefit/Loss
Income		750000		750000
Deductions
80C		150000
80D		25000
Housing Loan		200000
Standard Deduction		50000
Taxable Income		325000		750000

Upto INR 5 Lakhs		0		0
From INR 2.5 to 5 Lakhs		5%	12500	5%	12500
From INR 5 to 7.5 Lakhs		20%	NA	10%	7500
Total Tax Payable			12500		20000	52500

		Old Regime		New Regime		Tax Benefit/Loss
Income		1000000	1000000	1000000
Deductions
80C		150000
80D		25000
Housing Loan		200000
Standard Deduction		50000
Taxable Income		575000	575000	1000000
Slabs
From	To
0	250000	0		0
250000	500000	5%	12500	5%	12500
500000	750000	20%	15000	10%	25000
				15%	37500
Total Tax Payable			27500		75000	47500

		Old Regime		New Regime
Income		1000000	2000000	2000000
Deductions
80C		150000
80D		25000
Housing Loan		200000
Standard Deduction		50000
Taxable Income		1575000	1575000	2000000
Slabs
From	To
0	250000	0		0
250000	500000	5%	12500	5%	12500
500000	750000	20%	50000	10%	25000
750000	1000000	20%	50000	15%	37500
1000000	1250000	30%	75000	20%	50000
1250000	1500000	30%	75000	25%	62500
Above 15 Lakhs		30%	22500	30%	150000
Total Tax			285000		337500	52500

		Old Regime		New Regime		Tax Benefit/Loss
Income		1000000	3000000	3000000
Deductions
80C		150000
80D		25000
Housing Loan		200000
Standard Deduction		50000
Taxable Income		2575000	2575000	3000000
Slabs
From	To
0	250000	0		0
250000	500000	5%	12500	5%	12500
500000	750000	20%	50000	10%	25000
750000	1000000	20%	50000	15%	37500
1000000	1250000	30%	75000	20%	50000
1250000	1500000	30%	75000	25%	62500
1500000	1750000	30%	322500	30%	450000
Total Tax			585000		637500	52500

Budget 2020

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