If your annual income is between Rs 12 lakh to Rs 15 lakh, then you can opt for the old tax regime and save more tax than the new tax regime by using several deductions.
The government is trying to make the new income tax system attractive. For this reason, in the budget 2023-24, the government has given tax exemption on annual income up to Rs 7 lakh. If your annual income is high and you cannot claim deduction under the old tax regime, then the new tax regime will be better for you.
If you are eligible to claim tax exemption under the old tax regime, then you can get more benefits in tax exemption. Let us know if your income is between 12 to 15 lakhs, then you will need to deduct up to how much rupees under the old tax system and how you can get tax exemption.
How much deduction required under the old tax regime
If your annual income is between Rs 12 lakh to Rs 15 lakh, then you can opt for the old tax regime and save more tax than the new tax regime by using several deductions.
If you have an annual income of Rs 12 lakh, then under the old tax regime, you would need to deduct Rs 3.5 lakh, after which you would have to pay tax of Rs 82,500. On the other hand, after deducting Rs 3.62 lakh on Rs 13 lakh, tax of Rs 1.03 lakh will have to be paid. An income of Rs 14 lakh will require a deduction of Rs 3.75 lakh, followed by a tax of Rs 1.2 lakh, similar to the new tax regime, while an income of Rs 15 lakh will require a tax deduction of Rs 4.08 lakh, followed by Rs 1.4 lakh. Will have to pay tax of Rs.
How can you save more tax
There are some options under the old tax system, by choosing which you can save more tax. Under the old tax system, you can save tax up to Rs 5 lakh.
- Rs 1.5 lakh under section 80C
- Rs 2 lakh on home loan or HRA
- 50,000 on NPS investment under section 80CCD(1B)
- Rs 50,000 on health insurance premium under section 80D
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