ITR Filing: Old and New… Know how much income tax exemption you will get in one place
If you also get confused again and again about what exemptions you will get in the old tax regime and the new tax regime. So here you will get information about the income tax exemption available in both the tax regimes in one place.
The last date for filing an Income Tax Return (ITR) is 31st July is getting closer. If you are confused about which tax exemption is available in which of the old regime or the new regime. So here you will know at one place which income tax exemption you can avail in which regime.
Earlier there was only one tax regime in the country, which is now called the old tax regime. For the first time in the Union Budget 2020-21, a new tax system was launched, in which a big change was made in the budget of 2023-24. This is now called the new tax regime.
Tax exemptions available in the new tax regime
When the budget for 2023-24 was changed in the new tax regime, the biggest benefit was the addition of standard deduction. In this way, effectively people's income of Rs 7.5 lakh becomes tax-free. Apart from this, some other deductions are also available in this tax regime.
In the new tax regime, tax exemption is available for voluntary retirement under section 10 (10C). This tax exemption can be claimed for gratuity and leave encashment.
Apart from this, family pensioners can claim tax exemption of up to one-third of their pension, up to a maximum of Rs 15,000.
At the same time, salary individuals can get tax exemption on an employer's contribution to an NPS account under section-80CCD(2).
Tax exemptions available in the old tax regime
Many types of tax exemptions are available in the old tax regime. This includes savings for home-loans. For this, you can check the complete list below.
- Under Section 80C and 80CCC of the Income Tax Act, you can claim tax exemption on your savings like FD, tax saving mutual funds, and ELSS. Its maximum limit is Rs 1.5 lakh.
- Under 80CCC, you can get tax exemption on the premium of a new insurance policy or policy renewal. This is part of the limit of Rs 1.5 lakh of 80C.
- In 80CCD(1), 80CCD(1B), and 80CCD(2), you can get tax exemption on the contribution of Atal Pension Yojana, National Pension Scheme, etc. This is also part of the limit of 80C, however, under 80CCD(1B), an extra tax exemption of Rs 50,000 can be claimed on the contribution of NPS.
- Under Income Tax Sections 80D, 80DD, 80DDB, and 80U, you can claim tax exemption of up to Rs 25,000 on health insurance premiums. However, for senior citizens, this limit is up to Rs 50,000.
- Under Section 80E, you can get tax exemption on interest paid on education loans.
- Under Section 80G, if you donate to a political party or a charitable trust, you can get tax exemption on that.
- Under Section 80GG, you can get tax exemption on house rent allowance received with your salary.
- Under Section 80 TTA, you can get tax exemption on interest up to Rs 10,000 received from post office or bank.
- Under Section 80 TTB, senior citizens can get tax exemption on interest earned up to Rs 50,000.
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