Understanding the Difference Between New and Old Tax Regime in India

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Choosing between the new and old tax regime in India can significantly impact your take-home salary. The old regime offers multiple exemptions and deductions like HRA, LTA, and Section 80C. The new regime, on the other hand, offers lower slab rates but removes most deductions. If you're someone with high investments and deductions, the old regime might benefit you. But for those who don’t invest much, the new regime could offer more post-tax income. Salaried individuals must evaluate their income structure and expenses before locking in their regime. Always compare tax outgo under both options using online calculators or consult a tax advisor. Remember, your choice isn’t just about saving money now—it shapes your long-term tax planning strategy. The government allows regime switching each year for salaried taxpayers, giving flexibility to adjust based on annual changes in income or deductions.


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