If you are a taxpayer, then there has been an automatic shift in the new tax system. This means that now you have to go to the old tax structure, then that option has to be selected.
The new financial year has started. With this, there will be no tax on income of Rs 7 lakh every year under the new regime. This means that if you earn up to Rs 7 lakh, then you get rid of the hassle of tax. However, this is a setback for taxpayers who had invested with the aim of saving tax.
Actually, in the new regime, there is no system to claim against the investment. For this, investors have to select the old tax structure only. In such a situation, the benefit of tax exemption will not be available on income up to Rs 7 lakh.
What is the meaning of the claim: If you invest under Section 80C rule of Income Tax Act 1961 in the old tax structure, then you get tax exemption in return. Under this, you can get tax exemption by investing in post office schemes like Sukanya, PPF.
Apart from this, you can also save tax by investing in LIC or mutual funds. In this way, under section 80C rule, investors get tax exemption up to Rs 1.50 lakh. You can save tax by giving investment information. However, this will not be applicable in the new regime.
Default System: If you are a taxpayer, you have automatically shifted to the new tax system. This means that now you have to go to the old tax structure, then that option has to be selected. Explain that for the first time under the new system, the benefit of standard deduction of Rs 50,000 has been proposed.
Slab also changed: The slab has also changed in the new tax regime. If the annual income is up to Rs 3 lakh, then no tax will have to be paid. Apart from this, an annual income of Rs 3 lakh to Rs 6 lakh will be taxed at 5 per cent. Similarly, taxpayers will have to pay 10 per cent tax on Rs 6 lakh to Rs 9 lakh, 15 per cent tax on Rs 9 lakh to Rs 12 lakh.
Whereas, income from Rs 12 lakh to Rs 15 lakh will be taxed at 20 per cent and income above Rs 15 lakh will be taxed at 30 per cent.
