Tax Tips: Your annual income is Rs 15 lakh, know which tax regime is right for you..
Ever since the government introduced the new tax regime, a major question has arisen before the taxpayers which tax system is better for them? Many people are still in dilemma about whether they should adopt the new tax slab or the old tax slab will be better for them. It is worth noting that which tax regime will be more beneficial for which person, mainly depends on the income and investment of the person.
If a person's annual income is up to Rs 7.5 lakh, then the new tax system will be beneficial as there will be no tax to be paid in it. Also, employed people will not need to submit proof of their investment. But, for those whose income is Rs 15 lakh, choosing one of the two regimes becomes a bit complicated task. Let us know which regime will be right for people earning Rs 15 lakh.
Tax calculation in old tax slab
If you follow the old tax slab, you will get the benefit of a deduction.
Standard Deduction – ₹50,000
Total Income: ₹15,00,000 – ₹50,000 = ₹14,50,000
Section 80C (EPF, PPF, ELSS, NSC, Children’s Tuition Fees) – ₹1,50,000
Remaining Income: ₹14,50,000 – ₹1,50,000 = ₹13,00,000
Investment in NPS (Section 80CCD 1B) – ₹50,000
Remaining Income: ₹13,00,000 – ₹50,000 = ₹12,50,000
Home Loan Interest (Section 24B) – ₹2,00,000
Remaining Income: ₹12,50,000 – ₹2,00,000 = ₹10,50,000
Medical Policy (Section 80D) – ₹50,000 (for senior citizen parents)
Final Taxable Income: ₹10,50,000 – ₹50,000 = ₹10,00,000
If you invest in this way, your total tax in the old tax regime comes to ₹1,17,000.
Tax calculation in new tax slab
There is no deduction facility in the new tax slab, but a standard deduction of ₹75,000 is available.
After deducting ₹75,000 from total income:
₹15,00,000 – ₹75,000 = ₹14,25,000
If you earn ₹15 lakh per annum and file your return under the new tax regime, your total tax comes to ₹1,30,000.
Which tax slab is better?
If you take advantage of an investment tax deduction, then the old tax slab will be beneficial, because in this your total tax comes to ₹1,17,000. If you do not make any investment, then the new tax slab is a better option, because in this you will have to pay only ₹1,30,000 tax, whereas without deduction, the tax in the old slab would be ₹2,57,400.
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