The main aspects which differentiate between old Income Tax Slabs 2019-20 from new IT Slabs 2020-21 is given below
It is optional for any individual to choose either New Income Tax Slab 2020-21 or Old Income Tax Slab 2019-20.
Income Tax Slabs for Financial year 2019-20 and 2020-21 [ Existing Tax Rates and New Tax Rates]
|Taxable Income Slab (Rs.)||Existing Tax Rates||New Tax Rates|
|Above 15 Lakh||30%||30%|
The Comparison Chart for Old Income Tax Regime 2019-20 with New Income Tax Regime 2020-21 .
|Income Tax Slab||Old Income Tax Regime FY 2019-2020 [ For Income after Deduction]||New Income Tax Regime FY 2020-2021|
[For Income without any deduction]
|Up to Rs.2,50,000||Nil||Nil|
|Rs.2,50,001 to 5,00,000||5%||5%|
|Rs.5,00,000 to 7,50,000||Rs.12,500 + 20% of total income exceeding Rs.5,00,000||Rs.12,500 + 10% of total income exceeding Rs.5,00,000|
|Rs.7,50,001 to 10,00,000||Rs.62,500 + 20% of total income exceeding Rs.7,50,000||Rs.37,500 + 15% of total income exceeding Rs.7,50,000|
|Above Rs. 10,00,000 to Rs.12,50,000||Rs.1,12,500 + 30% of total income exceeding Rs.10,00,000||Rs.75000 + 20% of total Income exceeding Rs.10 Lakh|
|Above Rs. 12,50,000 to Rs.15,00,000||Rs.1,87,500 + 30% of total income exceeding Rs.12,50,000||Rs.1,25,000+25% of total Income exceeding Rs.12.5 Lakh|
|Above Rs.15,00,000||Rs.2,62,500 + 30% of total income exceeding Rs.15,00,000||Rs.1,87,000+30% of total Income exceeding Rs.15 Lakh|
Note : The Income tax Shown in Old income Tax regime is for the Income after applicable deduction and exemption . But new Income Tax regime doesn’t allow to avail any deductions or exemptions.
If an individual’s Income is Rs.1100000
If his Deductions and Tax exemptions is Rs.2.4 Lkahs
After Deduction and exemption the income is Rs.8.6 Lakh
So this individual comes under the Tax calculation slab of Rs.62,500 + 20% of total income exceeding Rs.7,50,000 in Old Tax regime
But In New Tax Regime 2020-21, the Income Tax will be calculated under the slab of Rs.75000 + 20% of total Income exceeding Rs.10 Lakh
So based on the deduction and exemptions , it can only be decided which regime is beneficial to the individual.
Tax Exemptions which are not available if Income Tax Rates under New Tax Regime is opted
1.Standard Deduction under Section 17(2) of Income Tax Act
2.All Section 80 C Deductions which is allowed up to Rs. 1.5 lakh for savings under GPF, NPS subscription by employee, ELSS, PPF, Insurance Premium etc
3.Additional Exempiton of Rs. 50,000 for NPS contribution under Section 80 CCD(1B)
4.Medical Insurance Premium Exempted under Section 80D
5.Exemption under Section 80 DD – Medical Expenses of specially abled dependents
6.Exemption under Section 80DDB – Medical Expenses in respect of certain illnesses.
7.Exemption allowed for House Rent Allowance under Section 10
8.Tax Exemption for LTC under Section 10
9.Income Tax Exemption under Section 24 allowed in respect of Interest paid on Housing Loan
10.Section 80 G Exemption – Donation paid to Charitable Institutions
11. Section 80 Exemption – Deduction allowed on Interest paid on Education Loan