Which tax regime is more beneficial for you

1

Old Vs New Tax Regime 

In union budget 2020, Government has proposed an optional reduced tax slab rate without claiming any deduction. So which option is more beneficial for you? Here's we have taken a few illustrations considering 2 deductions (Section 80C & 80D) which generally individuals prefer for tax deductions. 
  • Tax on income up to Rs.5 lakhs will be nil under both options. 

 

Case1 Old Rate New Rate Tax Benefit
Gross Total income 650000 650000
Deduction U/s 80C 150000 0
Deduction U/s 80D 0 0
Total Income 500000 650000
Tax 0 27500 Loss 27500


 

Case-2 Old Rate New Rate Tax Benefit
Gross Total income 750000 750000
Deduction U/s 80C 150000 0
Deduction U/s 80D 25000 0
Total Income 575000 750000
Tax 28600 37500.04 Loss 8900




Case-3Old RateNew RateTax Benefit
Gross Total income 1000000 1000000
Deduction U/s 80C 150000 0
Deduction U/s 80D 25000 0
Total Income 825000 1000000
Tax 80600 78000 Profit 2600




Case 4 Old Rate New Rate Tax Benefit
Gross Total income 1250000 1250000
Deduction U/s 80C 150000 0
Deduction U/s 80D 25000 0
Total Income 1075000 1250000
Tax 140400 130000 Profit 10400




Case 5 Old Rate New Rate Tax Benefit
Gross Total income 1500000 1500000
Deduction U/s 80C 150000 0
Deduction U/s 80D 25000 0
Total Income 1325000 1500000
Tax 226200 195000 Profit 31200




Case 6 Old Rate New Rate Tax Benefit
Gross Total income 2000000 2000000
Deduction U/s 80C 150000 0
Deduction U/s 80D 25000 0
Total Income 1825000 2000000
Tax 374400 351000 Profit 23400

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[Disclaimer:-This article is being furnished for informational purposes only. We make every effort to use reliable & comprehensive information, but we do not represent that the contents of the article are accurate or complete.]


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