Which tax regime is more beneficial for you

Old Vs New Tax Regime 

In union budget 2020, Government has proposed an optional reduced tax slab rate without claiming any deduction. So which option is more beneficial for you? Here's we have taken a few illustrations considering 2 deductions (Section 80C & 80D) which generally individuals prefer for tax deductions. 

• Tax on income up to Rs.5 lakhs will be nil under both options. 

 

Case1	Old Rate	New Rate	Tax Benefit
Gross Total income	650000	650000
Deduction U/s 80C	150000	0
Deduction U/s 80D	0	0
Total Income	500000	650000
Tax	0	27500	Loss 27500

 

Case-2	Old Rate	New Rate	Tax Benefit
Gross Total income	750000	750000
Deduction U/s 80C	150000	0
Deduction U/s 80D	25000	0
Total Income	575000	750000
Tax	28600	37500.04	Loss 8900

Case-3	Old Rate	New Rate	Tax Benefit
Gross Total income	1000000	1000000
Deduction U/s 80C	150000	0
Deduction U/s 80D	25000	0
Total Income	825000	1000000
Tax	80600	78000	Profit 2600

Case 4	Old Rate	New Rate	Tax Benefit
Gross Total income	1250000	1250000
Deduction U/s 80C	150000	0
Deduction U/s 80D	25000	0
Total Income	1075000	1250000
Tax	140400	130000	Profit 10400

Case 5	Old Rate	New Rate	Tax Benefit
Gross Total income	1500000	1500000
Deduction U/s 80C	150000	0
Deduction U/s 80D	25000	0
Total Income	1325000	1500000
Tax	226200	195000	Profit 31200

Case 6	Old Rate	New Rate	Tax Benefit
Gross Total income	2000000	2000000
Deduction U/s 80C	150000	0
Deduction U/s 80D	25000	0
Total Income	1825000	2000000
Tax	374400	351000	Profit 23400

 !! I hope it was helpful !!

!! Thank You !!

Join Us for regular Updates:

        On Whatsapp: Type "Updates" and send on Whatsapp Chat

On Twitter:https://twitter.com/CommerceInsider

   On Facebook:- https://www.facebook.com/commerceinsiders 

        On Instagram:- https://www.instagram.com/commerceinsiders/

 On telegram:- https://t.me/commerceinsiders

For further information contact at info@commerceinsiders.com

!! Thank You  !!

[Disclaimer:-This article is being furnished for informational purposes only. We make every effort to use reliable & comprehensive information, but we do not represent that the contents of the article are accurate or complete.]