An easy way to compare our tax benefit under existing & new tax scheme based on your keen to investment
An easy way to compare our tax benefit under existing & new tax scheme based on your keen to investment The Finance Minister placed the Finance Bill 2020 in the Lok Sabha with proposal of a new tax rates for Individual tax payer by restricting certain deductions and reliefs the individual assessee availed so far. Exemptions on HRA & LTA, Standard deduction available to Salaried persons, relief against payment of Professional Tax have to forego to avail the new tax scheme. Most of the deductions under Chapter VIA of Income Tax Act viz Contribution to Provident Fund, payment of Life & Medical Insurance premium, Purchase of NSC, Interest on Education Loan, Donations to Funds & Charitable Institutions as well as Relief available to Handicap Tax payer will not available. Moreover, Interest on House Building Loan will not get deducted in calculating taxable income under the new scheme.
Here is a table showing the tax benefit available under Existing & New Scheme based on your keen towards tax savings Investment & Payments.
| Total Annual Income | Minimum Investment Reqd. Including Standard Deduction Of ₹50000/- | Existing Rate | New Rate | Tax Benefit Under New Scheme | ||
| Income After Deduction & Relief | Tax Amount | Income Without Deduction & Relief | Tax Amount | |||
| 500000 | NIL | 500000 | NIL | 500000 | NIL | 0 |
| 600000 | 50000 | 550000 | 23400 | 600000 | 23400 | 0 |
| 700000 | 100000 | 600000 | 33800 | 700000 | 33800 | 0 |
| 800000 | 137500 | 662500 | 46800 | 800000 | 46800 | 0 |
| 900000 | 162500 | 737500 | 62400 | 900000 | 62400 | 0 |
| 1000000 | 187500 | 812500 | 78000 | 1000000 | 78000 | 0 |
| 1100000 | 187500 | 912500 | 98800 | 1100000 | 98800 | 0 |
| 1200000 | 180000 | 1020000 | 119600 | 1200000 | 119600 | 0 |
| 1300000 | 216667 | 1083333 | 143000 | 1300000 | 143000 | 0 |
| 1400000 | 233333 | 1166667 | 169000 | 1400000 | 169000 | 0 |
| 1500000 | 250000 | 1250000 | 195000 | 1500000 | 195000 | 0 |
| 1600000 | 250000 | 1350000 | 226200 | 1600000 | 226200 | 0 |
| 2000000 | 250000 | 1750000 | 351000 | 2000000 | 351000 | 0 |
| 2500000 | 250000 | 2250000 | 507000 | 2500000 | 507000 | 0 |
| 5000000 | 250000 | 4750000 | 1287000 | 5000000 | 1287000 | 0 |
The figures of Investment is the minimum amount including Standard Deduction of ₹50,000/- available to Salaried persons. If you Invest/Pay more than the above amount in FY:2020-21, the Existing Tax Scheme is more beneficial to you against respective Annual Income.
Author Bio
Hello
Good Comparison of old and new tax rates
thanks
Dr.Sandhu