Indian government introduced a new tax regime in 2020, allowing taxpayers to choose between old and new structures, sparking debates on their benefits.
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Old regime permits deductions under sections like 80C, 80D, and 24(b), reducing taxable income significantly.
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New regime offers lower tax rates but eliminates most deductions.
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Taxpayers must evaluate personal financial situations to weigh pros and cons of each regime, especially considering deductions and tax rates.
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For corporations, the new regime, once opted, is irrevocable.
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Careful projections for over a decade are crucial to ascertain the impact of foregoing eligible deductions versus adopting the new tax regime.
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Generally, individuals with less than 15 lakhs of taxable income may find the new tax regime beneficial due to its lower tax rates.
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Taxpayers should analyze income sources, expenses, and potential deductions to align with their financial situations.
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Consulting tax advisors or using online tax calculators can aid in comparing tax liabilities under both regimes for an informed decision.