What is deduction under 115BAC?
Two years ago, the 2020 Budget brought forth a new Section titled 115BAC which was incorporated into the Income Tax Act of 1961. The basic premise of this Section is to allow individuals as well as Hindu Undivided Families (or HUFs) with the option to take advantage of a new income tax regime.
The above table shows that it is beneficial to opt for the New Tax Regime of Section 115BAC if your Income is more than Rs. 8,50,000 with your eligible Deduction under 80C. The selection of New Tax Regime of Section 115BAC is not advisable up to your income Rs.
Who Cannot opt for 115BAC?
The switchover from one scheme to the another is allowed subject to certain conditions as discussed later. It is to be noted here that the slab rate of Rs. 3,00,000/ Rs. 3,50,000 enjoyed by Senior Citizens/Super Senior Citizens in Old slabs will not be available to them if they opt for this new tax regime.17-Nov-2021
FORM 10-IE Under Section 115BAC and 115BAD As per Rule 21 AG, each individual and Hindu Undivided Family who exercises the option as per section 115 AC(The new Tax Regime) has to file the application in the Form 10-IE via electronic mode on the income.26-Apr-2022
What is the benefit of new tax regime 115BAC?
What is Section 115BAC – the new tax regime? The Budget 2020 introduces a new regime under section 115BAC giving individuals and HUF taxpayers an option to pay income tax at lower rates. The new system is applicable for income earned from 1 April 2020 (FY 2020-21), which relates to AY 2021-22.31-Jul-2022
Conclusion. According to the above example, if your annual income is on the higher side, the old tax regime is a better option than the new one. Both the new and old income tax slabs have advantages and disadvantages.10-May-2022
Is new tax regime better than old?
Old vs New: A Comparison For Different Slabs 10 lakhs are taxed at 20%, under the old regime. And in the new regime, they will be taxed at half that rate i.e. 10%. Also, those with an annual income of Rs. 7.5 lakhs to Rs.25-Jul-2022
Is It Allowed To Swap Between The Old And New Income Tax Regimes Multiple Times? Salaried individual taxpayers can make this choice every year. Taxpayers with income under the head house property, salary, other sources, and capital gains can choose to switch between the old and the new regime every year.14-Jul-2022
Which tax regime is better for 20 lakhs?
For a salary ranging between Rs 20 lakhs and Rs 25 lakhs, the applicable tax rate under the new tax regime would be the highest, that is 30%.
Tax slabs and rates under the new tax regime
How can I save tax on 12 lakhs?
Tax Deductions under Section 80(C)
If your income is below ₹2.5 lakh, you do not have to file Income Tax Returns (ITR).
How can I save tax on 10 lakhs?
Tax savings scheme under Section 80C, NPS under Section 80CCD(1b), education or house loans, and even insurance premiums can help you achieve the goal of zero tax in a given year if your annual salary is less than Rs 10 lakh per year.04-Apr-2022
Standard deduction means a flat deduction to individuals earning salary or pension income. It was introduced back in Budget 2018 in lieu of exemption of transport allowance and reimbursement of miscellaneous medical expenses. FY 2020-21 the limit of the standard deduction is Rs 50,000.03-Aug-2022
Which tax regime is better for 50 lakhs?
Lower tax rates
Even if you don't have any home loan(both principal and interest are tax exempted upto a certain limit), education loan and 80CCD, old tax regime is better for middle class taxpayers and they could end up saving upto Rs. 15000/annum.
Which tax regime is better for 6 lakhs?
Under this new tax regime, your salary of Rs. 6.5 LPA would fall under the tax slab of 10%. This flat tax rate is far lower than the tax slab that your salary of 6.5 LPA would fall under with the existing tax regime - 20%.
Tax Exempted Salary Components
How can I save tax on 18 Lac?
1. Reduce Your Taxable Income by Up To Rs 1.5 Lakhs (Section 80C, 80CCC, 80CCD)
Surcharges Applicable for Resident Individuals
How can I save my maximum income tax?
Tax Saving Schemes
What is deduction under 115BAC?