Archive · 8 Aug 2025
Income Tax: Choosing the Right Tax Regime
When filing your taxes, you have to pick between two tax systems: the old one and the new one.
The old one lets you subtract certain expenses (like investments) from your taxable income, but the new one doesn't.
Experts say you should choose the old system if your total deductions are over a certain amount (like ₹4 lakh).
To figure out which is better, check your tax bill under both systems, using the online tax calculator.
The goal is to minimize your tax liability.
Taxpayers face a choice between the old and new income tax regimes when filing returns.
Choosing the old regime is beneficial when deductions exceed a certain threshold.
Experts advise comparing tax liabilities under both regimes before choosing.
The new regime offers lower rates but no deductions, unlike the old regime.
Taxpayers can use tax calculators to compare liabilities.
- Who
- Taxpayers.
- What
- Taxpayers are choosing between old and new tax regimes for filing returns.
- When
- At the time of filing income tax returns.
- Where
- India.
- Why
- To determine the most tax-efficient method for filing returns.
Old Tax Regime
New Tax Regime
Tax Rate
Old Tax Regime
Higher tax rates
New Tax Regime
Lower tax rates
Deductions
Old Tax Regime
Allows for tax deductions.
New Tax Regime
Doesn't allow tax deductions
- Deduction Threshold (Old Regime)
- ₹4 lakh
- New Regime Benefit
- Concessional rates
- Old Regime Benefit
- Allows deductions
