Union Budget 2024 was presented in the parliament on 23rd July 2024 by the Finance Minister, Nirmala Sitharaman. The new tax regime which was introduced in Budget 2020 was tried to made more lucrative with certain more exemptions. Recently, Nirmala Sitharaman has said that over 72% of people have opted for new tax regime for the AY 2024-25. Is the new tax regime really better than the old tax regime? Let’s find out with the comparison of their tax slabs.
Income Tax Slabs Under the New and Old Tax Regime in AY 2024-25 (FY- 2023-24)
| Annual Taxable Income | New Tax Regime | Old Tax Regime |
|---|---|---|
| Up to Rs. 2.5 lakh | Exempt | Exempt |
| Over Rs. 2.5 lakh to Rs. 3 lakh | Exempt | 5% |
| Over Rs. 3 lakh to Rs. 5 lakh | 5% | 5% |
| Over Rs. 5 lakh to Rs. 6 lakh | 5% | 20% |
| Over Rs. 6 lakh to Rs. 9 lakh | 10% | 20% |
| Over Rs. 9 lakh to Rs. 10 lakh | 15% | 20% |
| Over Rs. 10 lakh to Rs. 12 lakh | 15% | 30% |
| Over Rs. 12 lakh to Rs. 15 lakh | 20% | 30% |
| Above Rs. 15 lakh | 30% | 30% |
Certain tax saving investments cannot be claimed in the new tax regime. This includes the life insurance tax benefits. However, new tax regime has undergone a few changes after the Union Budget 2024 and certain other exemptions have been announced for the FY 2024-25.
Income Tax Slabs Under the New Tax Regime for AY 2025-26 (FY 2024-25)
| Annual Taxable Income Slabs | New Tax Regime Slab Rates FY 24-25 (AY 25-26) | New Tax Regime Slab Rates FY 23-24 (AY 24-25) |
|---|---|---|
| Up to ₹3,00,000 | Nil | Nil |
| From ₹3,00,001 to ₹6,00,000 | 5% on income exceeding ₹3,00,000 | 5% on income exceeding ₹3,00,000 |
| From ₹6,00,001 to ₹7,00,000 | 5% on income exceeding ₹3,00,000 | ₹15,000 + 10% on income exceeding ₹6,00,000 |
| From ₹7,00,001 to ₹9,00,000 | ₹20,000 + 10% on income exceeding ₹7,00,000 | ₹25,000 + 10% on income exceeding ₹7,00,000 |
| From ₹9,00,001 to ₹10,00,000 | ₹20,000 + 10% on income exceeding ₹7,00,000 | ₹45,000 + 10% on income exceeding ₹9,00,000 |
| From ₹10,00,001 to ₹12,00,000 | ₹50,000 + 15% on income exceeding ₹10,00,000 | ₹55,000 + 15% on income exceeding ₹10,00,000 |
| From ₹12,00,001 to ₹15,00,000 | ₹80,000 + 20% on income exceeding ₹12,00,000 | ₹90,000 + 20% on income exceeding ₹12,00,000 |
| Above ₹15,00,000 | ₹1,40,000 + 30% on income exceeding ₹15,00,000 | ₹1,50,000 + 30% on income exceeding ₹15,00,000 |
Some more relief have been provided to the taxpayers under the new tax regime for the AY 2025-26. However, the same tax rates under the new tax regime are applicable on citizens. On the other hand, old tax regime offers the senior citizens and super seniors citizens an opportunity to claim various tax benefits.
Income Tax Slabs Under the Old Tax Regime for Senior Citizens Aged Between 60-80 Years
| Annual Taxable Income Slabs | Income Tax Slab Rates |
|---|---|
| Up to ₹3,00,000 | Nil |
| From ₹3,00,001 to ₹5,00,000 | 5% |
| From ₹5,00,001 to ₹10,00,000 | ₹10,000 + 20% on income exceeding ₹5,00,000 |
| Above ₹10,00,000 | ₹1,10,000 + 30% on income exceeding ₹10,00,000 |
Income Tax Slabs Under the Old Tax Regime for Super Senior Citizens Aged Over 80 Years
| Annual Taxable Income Slabs | Income Tax Slab Rates |
|---|---|
| Up to ₹5,00,000 | Nil |
| From ₹5,00,001 to ₹10,00,000 | 20% on income exceeding ₹5,00,000 |
| Above ₹10,00,000 | ₹1,00,000 + 30% of total income exceeding ₹10,00,000 |
These are the basic comparisons that one needs to know before filing the ITR. However, there are certain other factors which can reduce or increase your tax liabilities. For further information and to file your taxes contact us.