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Home CURRENT AFFAIRS BUSINESS Income Tax News: FY2024 Tax Planning! Choosing Between Old and New Regimes,...

Income Tax News: FY2024 Tax Planning! Choosing Between Old and New Regimes, Benefits Explained

Stressing that you have the option to select between the previous and current tax regimes until you file

Income Tax News

Income Tax News: As the year comes to an end, employers will want documentation of your qualified investment and outlay in order to match your tax obligation by the end of March. This is the right time to review your tax decisions, especially the one where you decided between the new and old tax regimes.

Employee Declaration at the Beginning of Fiscal Year

Employees usually inform employers at the beginning of the fiscal year about their preferred tax regime. This statement isn’t legally binding, though, as you can change your mind up until the income tax return is filed. How then do you decide between the new and the old tax regime? Six income slabs and a basic exemption limit of Rs 3 lakh comprise the new tax regime. In addition, it provides a 25% surcharge instead of the previous regime’s 37% surcharge for income over Rs 5 crore. With the new regime’s increased tax rebate limits to Rs 7 lakh, individuals with fewer claimable investments stand to benefit.

Old Regime’s Favorable Treatment of Deductions

While the old regime favoured those eligible for various deductions such as health insurance, home loan interest, PPF, EPF, insurance, and equity linked savings schemes, the new regime is more advantageous to those with fewer deductions. Prior to making a decision, taxpayers need to consider the exemptions that they will lose under the new regime.

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