Tax Structure Change: Users switching from the old tax regime to the new tax regime must first know whether the new tax regime will be better for them or whether the old tax regime will be beneficial. Let us tell you that in the old tax regime, exemption is available in section 80D for 80c, NPS, HRA, 80 TTA and health insurance premium.
Tax Structure Change: The new tax structure will be implemented across the country from April 1, 2025. After this, those who get salary up to 12 lakhs will get rid of the tension of income tax, but for this they will have to choose the new tax regime. Now the question arises that those whose salary is more than Rs 12 lakh and they have opted for the new tax regime, will they benefit from it or suffer loss. Along with this, the second question arises, those who have opted for the old tax regime and their salary is more than 12 lakhs, will they benefit or suffer loss?
If you also have similar questions and you have not yet understood the difference between the old tax regime and the new tax regime, then there is no need to worry, because here we are telling you in detail about both these tax regimes.
Ola vs New Tax Regime
Users switching from the old tax regime to the new tax regime must first know whether the new tax regime will be better for them or the old tax regime will be beneficial. Let us tell you that in the old tax regime, exemption is available in section 80D for 80c, NPS, HRA, 80 TTA and health insurance premium, whereas in the new tax regime, only a few exemptions are available, including deduction under section 80CCD (2) for employer’s contribution to NPS. Also, tax exemption is available on the amount received for telephone and transport.
If CTC is Rs 25 lakh, then which tax regime is better?
For example, an employee whose CTC is currently Rs 25 lakh and who has always chosen the old tax regime to save income tax, the income tax slabs are going to change in the new tax regime from April 1, 2025. In such a situation, now which of the new and old tax regimes will benefit him.
If CTC is Rs 25 lakh, then which tax regime is better?
For example, an employee whose CTC is currently Rs 25 lakh and who has always chosen the old tax regime to save income tax, the income tax slabs are going to change in the new tax regime from April 1, 2025. In such a situation, now which of the new and old tax regimes will benefit him.
The index given below shows the details of CTC of Rs 25 lakh separately for the old tax regime (OTR) and the new tax regime (NTR). This is because the employer’s contribution to the NPS account is different. In the old tax regime, deduction of up to 10% of basic salary was allowed under Section 80CCD (2), while in the new tax regime it has been set at 14%.
| Description | Old Tax Regime | New Tax Regime |
| Total Salary | 20,31,900 | 20,31,900 |
| Car lease perquisite value (<1600 CC engine) | 21,600 | 21,600 |
| gross pay | 20,53,500 | 20,53,500 |
| Mobile Reimbursement | 50,000 | 50,000 |
| Conveyance reimbursement | 2,40,000 | 2,40,000 |
| Car leasing amount | 3,00,000 | 3,00,000 |
| Net Pay | 14,63,500 | 14,63,500 |
| LTA exemption | 1,00,000 | 0 |
| Standard deduction | 50,000 | 75,000 |
| HRA exemption | 2,60,000 | 0 |
| Food coupons | 26,400 | 0 |
| Taxable Salary | 10,27,100 | 13,88,500 |
| Section 80C deduction | 1,50,000 | 0 |
| Employer’s NPS Contribution | 100,000 | 1,40,000 |
| NPS deduction of Rs 50,000 | 50,000 | 0 |
| Exemption under section 80TTA | 10,000 | 0 |
| Section 80D Insurance Premium Discount | 50,000 | 0 |
| Net Taxable Salary | 6,67,100 | 12,48,500 |
| Tax Amount | 47,757 | 50,440 |
However, if you have exhausted options for deductions and exemptions and are likely to pay more income tax under the old tax regime, switch to the new tax regime. This will lead to greater tax savings and the process will be more streamlined, as it eliminates the need to arrange proofs and maintain records to claim deductions and exemptions.
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