Old vs New Tax Regime: Which One Should You Choose for Maximum Savings?

Make an Informed Choice Between Old vs New Tax Regime for Financial Success!

The recent tabling of the new Income Tax Bill by the Honorable Finance Minister in the Lok Sabha marks a significant moment for taxpayers across the nation. As we look ahead to the financial year 2024-25, it’s crucial to understand that both the old and new tax regimes will continue to operate under the existing Income Tax Act. This dual framework ensures that taxpayers have options tailored to their financial circumstances.

The proposed changes, particularly under section 115BAC, offer a streamlined approach aimed at simplifying compliance while potentially lowering tax burdens for many individuals. Section 202 of the new Income Tax Bill, 2025, outlines these adjustments clearly, setting a foundation for what could be a more equitable tax system.

It’s important to note that once this bill is passed and comes into effect on April 1st, 2026, it will replace previous regulations with updated guidelines designed to enhance transparency and efficiency in tax collection. As citizens, we must stay informed and engaged with these developments; understanding how they affect our finances is essential for making informed decisions moving forward. Embrace this opportunity to educate yourself on how these changes may benefit you in your personal financial planning.

The modified slab rates for new tax regime applicable for FY 2025-2026 are as follows:

Income Tax Slabs Tax Rates

Up-to Rs. 4,00,000 NIL

Rs. 4,00,001 - Rs. 8,00,000 5%

Rs. 8,00,001 - Rs. 12,00,000 10%

Rs. 12,00,001 - Rs. 16,00,000 15%

Rs. 16,00,001 - Rs. 20,00,000 20%

Rs. 20,00,001 - Rs. 24,00,000 25%

Above Rs. 24,00,000 30%