If you earn income from your salary or business, then it is time to get ready to file your income tax return (ITR Filing for FY23-24). In March, taxpayers are racking their brains over tax calculators and tax saving. And now they have a structure of two tax regimes each.
If you have invested and want to save tax, then in this regard taxpayers prefer to choose the Old Tax Regime, but given the low tax rate, there is no dearth of people choosing the New Tax Regime. . But there have been many changes in the new tax regime in the last budget, due to which it has become even more attractive. Do you know that you can also avail some deductions (Deductions allowed under the New Tax Regime) in the new tax regime?
Special features of the New Tax Regime
You must be aware that the new tax regime has now become the default option after Budget 2023. When it was introduced in the budget of 2020, taxpayers could choose it separately. But now this is the default, that is, if you do not manually select the option to choose the old tax regime, then your ITR will be filed in the new tax regime only.
While earlier there was no provision for standard deduction in the new tax regime, after Budget 2023, now a rebate of Rs 50,000 is available in this regime, irrespective of which tax slab the taxpayer falls under. Everyone gets it.
If taxpayers fall in the disabled category, they are allowed to claim a deduction on transport allowance.
Employed people also get exemptions on perks or allowances they get for travel, transport, conveyance, and office work.
Voluntary Retirement Scheme (VRS), gratuity, and leave encashment are also now exempted, subject to certain conditions.
If you are paying a home loan for a house given on rent, then you can claim a deduction on its interest.
Tax exemption can be availed on gifts up to Rs 50,000.
Employed people investing in an NPS (National Pension System) account can also claim tax deductions on their contributions.
If you are earning income from a family pension, then under the new regime you can claim a deduction of up to Rs 15,000 or one-third of the pension amount (whichever is less).
New Tax Regime Income Tax Slabs
In the new tax regime, there is no tax on annual salary of Rs 0-3 lakh. After this, a 5 percent tax is levied on the income of Rs 3 to 6 lakh, 10 percent on income of 6 to 9 lakh, 15 percent on income of 9 to 12 lakh, 20 percent on income of 12 to 15 lakh, and 30 percent on income above Rs 15 lakh. Apart from this, 4 percent is levied as Health and Education Cess.
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