Income Tax Return: While presenting the Union Budget on February 1, Finance Minister Nirmala Sitharaman had announced changes in personal income tax. Nirmala Sitharaman had announced that the new taxation system imposed by the government would be in default from the financial year 2023-24. Under the new system, tax exemption can be obtained on income of Rs 7 lakh annually. Taxpayers with annual income up to Rs 7 lakh will save Rs 33,800 in taxes after increasing the exemption under the new income tax regime through the Finance Minister.
Income Tax
There are some benefits in the new tax regime but there is no exemption on any investment in it. However, standard deduction has definitely been added to the new tax regime. On the other hand, if you want investment or other exemption, then you will have to file tax according to the old tax regime. Many exemptions are available in the old tax regime. Today we are going to tell you about it…
Deductions available under old tax regime
1. Standard Deduction: Rs.50000 for salaried individuals.
2.Section 80CCD(1B): Additional deduction up to Rs 50,000 for deposits in NPS account.
3.Section 80TTA: This section provides a deduction of a maximum of Rs 10,000 on interest income from a bank, co-operative society or post office savings account for an individual or a HUF.
4.Section 80D: It allows deduction on health insurance premium.
5. Section 80G: Donations made to eligible trusts and charitable institutions are eligible for deduction.
6. Section 80C: Invest in EPF and PPF, ELSS, life insurance premium, home loan repayment, SSY, NSC and SCSS and get exemption.
Taxpayers should note that if you are an employee and fail to choose between the new-old tax regime, TDS will be deducted at the new tax regime rates. The matter has become clear from a circular of the Central Board of Direct Taxes. It said, “If the notice is not given by the employee, it will be deemed that the employee continues to be in the default tax regime and has not exercised the option to opt out of the new tax regime. shall deduct tax at source on the income under section 192 of the Act, in accordance with the rates provided under sub-section (lA) of section 115BAC.”
