Features | Old Regime | New Regime |
|---|---|---|
Standard Deduction | ₹50,000 | ₹50,000 |
Section 80C (Investments) | Up to ₹1.5 lakh | Not Available |
Section 80D (Medical) | Up to ₹25,000 (self) ₹50,000 (senior citizens) | Not Available |
Section 24 (Home Loan Interest) | Up to ₹2 lakh | Not Available |
Section 80E (Education Loan Interest) | Full interest paid | Not Available |
House Rent Allowance (HRA) | Available | Not Available |
Leave Travel Allowance (LTA) | Available | Not Available |
Income Tax Rates | Slabs with deductions | Lower slabs without deductions |
Rebate under Section 87A | ₹12,500 for income up to ₹5 lakh | ₹12,500 for income up to ₹7 lakh |
Key Highlights:
Old Regime Benefits:
Section 80C: Avail up to ₹1.5 lakh on investments like PPF, EPF, NSC, etc.
Section 24: Deduct up to ₹2 lakh on home loan interest
Section 80D: Deduct up to ₹25,000 on medical insurance premium
New Regime Simplicity:
Standard Deduction: A flat ₹50,000 for all salaried individuals
Lower Tax Rates: More beneficial for individuals with fewer deductions
Who Should Choose What?
Old Regime: Ideal if you have significant investments and eligible for multiple deductions
New Regime: Suitable for those seeking simplicity and lower tax rates without needing to invest for tax-saving purposes
Conclusion
The choice between the old and new tax regimes depends on your financial situation and tax planning preferences. Evaluate your deductions and investments to make an informed decision.
For further details check – LinkedIn post
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