Financial plan 2020 has presented the new tax regime for F.Y 2020-21 notwithstanding the old tax regime. F.Y 2020-21 onwards the taxpayer can pick the best tax regime dependent on the tax-sparing potential, reasonableness, and quick needs.
This article covers
1. Rates of taxes and Tax Chunks Examination
2. Availability of Deductions
3. Increased bring home Compensation
4. Reduced compliance and Administrative work
5. How to choose which Tax Regime is correct?
1. Paces of taxes and Tax Chunks Examination
The new regime accommodates concessional paces of taxes for products chunks while old regime accommodates standard paces of taxes
2. Accessibility of Deductions
The new tax regime doesn’t permit the taxpayer to profit certain deductions and exceptions while the old regime gives that a taxpayer can guarantee deductions and exclusions which are accessible to him.
A portion of the deductions that the taxpayers will lose on the off chance that they select the new regime are
1. Standard Allowance of Rs 50000
2. House Lease Remittance (HRA)
3. Leave Travel Recompense (LTA)
4. Entertainment Recompense
5. Professional Tax (PT)
6. Interest paid on Lodging Credit u/s 24
7. 80C Deductions like LIC, Home Credit Head, PPG, NSC and so on
8. 80D Allowance i.e., Medical coverage paid for self and family
9. 80DD and 80DDB identified with Inability
10. Interest paid on Training advance u/s 80EE
11. Donations u/s 80G, 80GGA, 80GGC
Download Automated Income Tax Preparation Excel Based Software All in One for the Non-Govt (Private) Employees for the F.Y.2020-21 as per New and Old Tax Regime(System) U/s 115 BAC
Feature of this Excel Utility:-
1) This Excel Utility Prepare Your Income Tax as per your option U/s 115BAC perfectly.
2) This Excel Utility has the all amended Income Tax Section as per Budget 2020
3) Automated Calculation Income Tax House Rent Exemption U/s 10(13A)
4) Individual Salary Structure as per the West Bengal Govt. Employees Salary Pattern as per ROPA-2019
5) Individual Salary Sheet
6) Individual Tax Computed Sheet
7) Automated Income Tax Revised Form 16 Part A&B for the F.Y.2020-21
8) Automated Income Tax Revised Form 16 Part B for the F.Y.2020-21
10) Automatic Convert the amount into the in-words without any Excel Formula
3. Expanded bring home Compensation
New Tax Regime gives a chance to build the bring home pay of the taxpayer and isn’t needed to contribute forthright, while the old tax regime lessens bring home as the taxpayers are needed to put resources into certain drawn-out ventures to profit the advantages.
4. Decreased compliance and Administrative work
Under New tax regime, the taxpayer need not stress over the documentation and compliances as the majority of the exclusions and deductions are not accessible. While the taxpayers under the old regime need to have all the proofs, and by and large, the representative needs to submit such proofs to the business for asserting deductions and exceptions
5. Which Tax Regime to be Chosen?
There is a ton of disarray with respect to which regime to pick. In any case, choosing the correct regime helps in the advancement of taxes and riches creation in future. The Taxpayer needs to assess both the regimes relying upon the salary, deductions, exclusions and so on and select the correct regime.
Download Automated Income Tax Salary Arrears Relief Calculator U/s 89(1) with Form 10E for the F.Y.2020-21 as per New and Old Tax Regime (System) U/s 115 BAC [This Excel Utility can prepare from the Financial Year 2000-01 to Financial Year 2020-21 (Up-to-date Version)
The tools accessible to effectively choose the correct tax regime are to utilize an
1) Old versus New Tax Calculator or
2) Taking a Specialist Tax Discussion from EZ Tax. into a survey, propose the right one.