"Old vs New Tax Regime: Key Differences Simplified"

The article compares the Old Tax Regime and New Tax Regime, highlighting differences in tax slabs, exemptions, deductions, and complexity, with the Old Regime offering flexibility for tax optimization while the New Regime simplifies calculations and lowers effective rates for certain incomes. Taxpayers can choose the regime based on their exemption claims and income levels.


Aspect Old Tax Regime New Tax Regime
Tax Slabs Progressive tax slabs with higher rates for higher income levels. Common slabs include 5%, 10%, 20%, and 30%. Revised and simplified tax slabs with lower rates, such as 5%, 10%, 15%, 20%, and 30%.
Exemptions and Deductions Allows various exemptions such as House Rent Allowance (HRA), Leave Travel Allowance (LTA), and deductions under sections like 80C, 80D, 80TTA, etc. Does not allow most exemptions and deductions, including HRA, LTA, and deductions under sections like 80C, 80D.
Standard Deduction A standard deduction of ₹50,000 is available to salaried taxpayers. The standard deduction of ₹50,000 is available starting from Budget 2023 changes.
Tax Calculation Complexity More complex due to the inclusion of multiple exemptions and deductions. Simpler as it does not involve exemptions and most deductions.
Suitability Suitable for taxpayers who claim multiple exemptions and deductions. Suitable for taxpayers with fewer exemptions and deductions to claim.
Flexibility Provides flexibility to optimize tax savings through exemptions and deductions. Offers less flexibility for tax optimization.
Tax Rate Comparison Higher effective tax rates due to fewer slab options. Lower effective tax rates for specific income levels due to revised slabs.


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  • Leave-travel-allowance-taxabl

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  • Optimize-tax-savings-salary-r

  • Save-taxes-through-donations-

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