Income tax slabs FY 2024-25: Five tips to help taxpayers decide between old and new income tax regimes

livemint.com:

income tax regime becoming the default option since FY 2023-24, taxpayers must comprehend the applicable income tax rates and slabs. Earlier on April 1, the Finance Ministry addressed confusion surrounding the new tax regime through a post on X (formerly Twitter).

The post stated, "Misleading information related to the new tax regime is being circulated on some social media platforms." If you're having difficulty deciding between the two regimes, these tips can assist you in making the right choice. 1)The key difference between the old and new income tax regimes lies in how they handle exemptions and deductions.

Under the old regime, taxpayers can claim substantial deductions, including those specified in Section 80C, Section 80D, and Section 80TTA of the Income Tax Act. Conversely, individuals choosing the new regime can enjoy reduced tax rates depending on their income bracket, without as many deductions available.

2) Since there were no changes announced in the Interim Budget presented by Finance Minister Nirmala Sitharaman on February 1, 2024, the standard deduction for the financial year 2024-2025 remains unchanged.

It stays at ₹50,000 for both the old and new income tax regimes. 3) 3)Under the new tax regime, the income tax slabs are structured as follows: 4) In the old tax regime, the income tax slabs are structured as follows: 5) As the new income tax regime is automatically applied, it's crucial for employed individuals to inform their employer at the beginning of the financial year regarding their preferred tax regime.