The Finance Act 2023 has made the new tax regime under Section 115BAC the default tax regime for individuals, HUFs, AOPs (excluding co-operative societies), BOIs, and Artificial Juridical Persons from AY 2024-25 onwards. However, taxpayers still have the option to opt out and choose the old tax regime.<\/p>\n
Non-business taxpayers can make this choice annually in their ITR, while business taxpayers must submit Form 10-IEA before the due date under Section 139(1) to opt out or re-enter the new regime. Below are some frequently asked questions (FAQs) to help taxpayers understand the differences and implications of both tax regimes.<\/p>\n
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The old tax regime provides multiple exemptions and deductions (e.g., HRA, 80C, 80D), whereas the new tax regime offers lower tax rates but limited deductions.<\/p>\n\n<\/div>\n<\/div>\n
It depends on individual financial situations. Taxpayers should compare tax liabilities under both regimes using the Income Tax Calculator on the Income Tax Portal.<\/p>\n\n<\/div>\n<\/div>\n
Yes, employees must inform their employers; otherwise, tax will be deducted under the default new tax regime. However, final selection occurs while filing ITR.<\/p>\n\n<\/div>\n<\/div>\n
No, the HRA exemption under Section 10(13A) is available only under the old tax regime.<\/p>\n\n<\/div>\n<\/div>\n
Yes, from AY 2024-25, a standard deduction of Rs. 50,000 is available in both tax regimes.<\/p>\n\n<\/div>\n<\/div>\n
No, most deductions under Chapter VI-A are not available except for 80CCD(2), 80CCH, and 80JJAA.<\/p>\n\n<\/div>\n<\/div>\n
No, this deduction is only available in the old tax regime.<\/p>\n\n<\/div>\n<\/div>\n
No, while the old tax regime provides a higher exemption limit (Rs. 3 lakh for seniors, Rs. 5 lakh for super seniors), the new regime provides a tax rebate on incomes up to Rs. 7 lakh.<\/p>\n\n<\/div>\n<\/div>\n
Yes, in the old regime, the rebate applies up to Rs. 5 lakh of income, whereas in the new regime, it applies up to Rs. 7 lakh with a maximum rebate of Rs. 25,000.<\/p>\n\n<\/div>\n<\/div>\n
Business taxpayers must file Form 10-IEA to opt for the old regime. Non-business taxpayers can select the old regime directly in the ITR.<\/p>\n\n<\/div>\n<\/div>\n
Business taxpayers can switch only once. Non-business taxpayers can switch every year.<\/p>\n\n<\/div>\n<\/div>\n
No, the new regime is the default from AY 2024-25. Business taxpayers must submit Form 10-IEA again to opt for the old regime.<\/p>\n\n<\/div>\n<\/div>\n
No, once submitted, it cannot be revoked in the same year.<\/p>\n\n<\/div>\n<\/div>\n
AOPs, BOIs, and Artificial Juridical Persons must file Form 10-IEA. Manufacturing co-operative societies must file Form 10-IFA.<\/p>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div>","protected":false},"excerpt":{"rendered":"
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