The income tax system in India operates through a progressive slab structure. The amount of tax an individual pays is directly proportional to their income in a financial year. The system is designed to ensure fairness, where higher earnings are taxed at a higher rate.<\/p>\n

The income tax slabs are periodically revised, usually as part of the Union Budget announcements. During the Budget 2024, a few changes were introduced to the tax slabs under the new tax regime, alongside some adjustments to exemptions and deductions.<\/p>\n

The new tax regime offers lower tax rates without any deductions. On the other hand, the old tax regime provides several deductions under various Sections of the Income Tax Act, 1961, though the tax rates are higher.<\/p>\n

New tax regime slabs <\/strong>(for taxpayers below 60 years of age)<\/p>\n

For taxpayers under the new tax regime, the following income tax slabs apply:<\/p>\n

\n
• Up to Rs 3 lakh: No tax.<\/li>\n
• Rs 3 lakh to Rs 7 lakh: 5 per cent<\/li>\n
• Rs 7 lakh to Rs 10 lakh: 10 per cent<\/li>\n
• Rs 10 lakh to Rs 12 lakh: 15 per cent<\/li>\n
• Rs 12 lakh to Rs 15 lakh: 20 per cent<\/li>\n
• Above Rs 15 lakh: 30 per cent<\/li>\n<\/ul>\n

  Old tax regime slabs<\/strong><\/p>\n

  Under the old tax regime, which still remains available for taxpayers, the income tax slabs are as follows:<\/p>\n

  \n
  • Up to Rs 2.5 lakh: No tax is applicable.<\/li>\n
  • Rs 2.5 lakh to Rs 5 lakh: 5 per cent\u00a0<\/li>\n
  • Rs 5 lakh to Rs 10 lakh: 20 per cent\u00a0<\/li>\n
  • Rs 10 lakh and above: 30 per cent<\/li>\n<\/ul>\n

    The standard deduction for salaried taxpayers has been increased to Rs 75,000 under the new regime. It remains at flat Rs 50,000 under the old tax regime. \u00a0<\/p>\n

    Choosing between the old and new tax regimes<\/strong><\/h2>\n

    When deciding between the old and new tax regimes, assess both and choose the one suited best as per your earnings and investments.<\/p>\n

    Old regime:<\/strong> The old tax system allows for various exemptions and deductions, such as those under Section 80C for investments and Section 80D for insurance premiums. Additionally, individuals can benefit from savings-focused provisions like deductions on home loan interests and HRA (House Rent Allowance). The old regime could be beneficial for those with significant deductions.<\/p>\n

    New regime:<\/strong> The new tax regime simplifies the tax process by offering lower rates but does not provide the same range of exemptions and deductions. It may suit those with fewer investments or those who prefer simpler tax filing, as it eliminates the need for tax-saving investments.\u00a0<\/p>\n

    How to calculate your tax<\/strong><\/h3>\n

    To calculate your tax liability under either regime, you must first determine your taxable income:<\/p>\n

    Old regime: <\/strong>Start with your total income, calculate the applicable deductions (such as 80C, 80D, and others), and apply the relevant tax slabs to the net taxable income.<\/p>\n

    New regime:<\/strong> You will calculate tax based on your total income, as no deductions are allowed in this regime. Your tax liability is directly calculated according to the tax slabs mentioned earlier.<\/p>\n

    Inform your employer<\/strong><\/h3>\n

    One of the most important things to do is to inform your employer about the tax regime you choose, as this will impact the TDS (Tax Deducted at Source) from your salary. Your employer will calculate the tax based on the regime you select, ensuring your taxes are deducted appropriately.<\/p>\n

    \u200bThe income tax system in India operates through a progressive slab structure. The amount of tax an individual pays is directly proportional to their income in a financial year.\u00a0\u00a0<\/p>","protected":false},"excerpt":{"rendered":"

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