Old regime of Income Tax v/s New regime of Income tax

Article author
Nneka
  • Updated

Old tax regime - The Old tax regime has many deductions under numerous sections that help employees to invest in tax saving options. Below is the slab rate for tax computation under the old regime applicable from FY 2020-21:

For individuals / HUF up to the age of 60 years during FY 2020-21

Total taxable income (in INR)

Rates

NIL - 2,50,000

0%

2,50,000 - 5,00,000

5%

5,00,000 - 10,00,000

20%

More than 10,00,000

30%

During individuals/HUF more than 60 years but less than 80 years of age during FY 2020-21

Total taxable income (in INR)

Rates

NIL - 3,00,000

0%

3,00,000 - 5,00,000

5%

5,00,000 - 10,00,000

20%

More than 10,00,000

30%

During individual/HUF more than 80 years during FY 2020-21

Total taxable income (in INR)

Rates

NIL - 5,00,000

0%

5,00,000 - 10,00,000

20%

More than 10,00,000

30%

New tax regime - Under the new tax regime, various deductions and exemptions are not allowed. For example - exemption in HRA, Meal allowance, LTA, the deduction for Medical insurance, LIC premium, equity-linked security scheme, donations to political parties, etc. except for NPS contribution u/s 80 CCD. Below is the slab rate for tax computation under the new regime applicable from FY 2020-21:

Total taxable income (in INR)

Rates

NIL -2,50,0000

0%

2,50,000-5,00,000

5%

5,00,000-7,50,000

10%

7,50,000-10,00,000

15%

10,00,000-12,50,000

20%

12,50,000-15,00,000

25%

More than 15,00,000

30%

Notes: (applicable to both regimes)

  • An additional 4% cess shall be calculated over and above tax.
  • The surcharge shall also be calculated as follows:
    • Income of more than INR 50 lakhs and up to INR 1 crore: 10% of income tax calculated
    • Income of more than INR 1 crore and up to INR 2 crore: 15% of income tax calculated
    • Income of more than INR 2 crore and up to INR 5 crore: 25% of income tax calculated
    • Income of more than INR 5 crore: 37% of income tax calculated
    • No separate slab rates for Senior citizens in case of new tax regime

 

Was this article helpful?

0 out of 1 found this helpful

Have more questions? Submit a request

Comments

0 comments

Article is closed for comments.