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Understanding Differences Between Old and New Regimes
I’m Anuram, the Founder of ReviseTax.
ReviseTax is a company that works on tax saving strategies for salaried employees of the country, offering personalized tax-saving solutions before filing the ITR. We plan and structure your income and expenses in such a way that you don’t pay a rupee more than needed.
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It is about choosing the right tax regime!
But, you don't need to worry, we’ll sort out all your queries!
Here's a breakdown to help you decide which one works best for you:
👉New Tax Regime:
Zero tax on income up to ₹7,00,000 (compared to ₹5,00,000 in the old regime).
Overall lower tax rates.
But there's a catch! You won't be able to claim popular deductions like 80C (investments, PPF, etc.) and 80D (medical insurance).
But You can claim NPS U/s Section 80CCD(2) Employer Contribution & 80 CCD(1) Maximum up to Rs.50,000.
👉Old Tax Regime:
The old regime lets you claim deductions to reduce your taxable income, which can be a big tax saver.
However, tax rates are generally higher compared to the new regime.
So, which regime should you choose?
👉If your total deductions are less than ₹1.5 lakh a year, the new regime might be simpler and save you time.
👉If your deductions are more than ₹3.75 lakh a year, the old regime could potentially save you more tax.
Still unsure? Here's a pro tip:
Old Regime would be the most preferred choice as it brings deduction for very common expenses, such as Rent, more financial discipline in investments and tax savings.
