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 |
