There has been some changes made to New Tax slabs during budget in 2023. Until 31-Mar-2023, Old Tax slabs might have been better option for you but that might change with new changes in New Tax slabs. In this video I have explained with examples which option might be better for you in FY2023-24.
Correction/Notes:
1. 24(b) - House Loan Interest Deduction - This is shown as "Self-occupied" in the excel and mentioned as claiming the house loan interest under New Tax Regime. That is incorrect. The correct information is that the interest amount paid on housing loan taken for rented apartment can be adjusted with the rent amount to reduce the taxable income which can be claimed under New Tax Regime (But note that the interest paid on housing loan for self-occupied property is not available under New Tax Regime)
2. Marginal Relief - I have missed to consider "Marginal Relief" under New Tax Regime during the video. If someone's taxable salary is slightly more than Rs. 7.5 Lakh then "Marginal Relief" will be applied to ensure that the tax payable is not more than the income that exceeds Rs. 7.5 Lakh (this will be for the individual whose taxable salary is between Rs. 7 Lakh to approx. 7.3 Lakh) , as a result total tax will not be Rs. 26,000 rupees under the New Tax Regime for a salary of Rs. 7.6 Lakh which I have shown as an example during the video (at 9 minutes, 7 seconds). The tax payable will be Rs. 10,000 only. The "Marginal Relief" will be calculated as below:
Tax on Income - Additional income above Rs. 7.5 Lakh (as per that example of Rs. 7.6 Lakh income with New Tax Regime, "Marginal Relief" will be Rs. 26,000 (Tax on Income) - Rs. 10,000 (Income above Rs. 7.5 Lakh) = Rs. 16,000. So, total tax will be Rs. 10,000).
Please comment if you need more clarity.
