With effect from Financial Year 2024-2025, the following rates provided under the sub-section (1A) of Section 115BAC (New Tax Regime) of the Income Tax Act shall be the rates applicable for determining the income tax payable in respect of the total income of a person, being an individual or Hindu undivided family or association of persons [other than a co-operative society], or body of individuals, whether incorporated or not, or an artificial juridical person.

Notes:

• Deduction under Section 16(ia) in respect of Standard Deduction of maximum INR 75,000.
• In the New Tax Regime, a taxpayer will have to forgo all the commonly available tax deductions and exemptions such as those available under section 80C, 80D, LTA exemption, HRA exemption, Professional Tax, Housing Loan Interest etc. except for section 80CCD (2), i.e., Employer's Contribution to NPS.
• The taxable income rebate limit under Sec 87A in the New Tax Regime is INR 7,00,000, meaning that taxpayers in the New Tax Regime with income up to INR 7,00,000 will not have to pay any income tax. Hence, taxpayer will get the maximum rebate amount of INR 20,000 under New Tax Regime.
• Section 87A rebate is applicable for only the taxpayer who is resident in India.
• Section 87A rebate is not applicable for PAN not available cases.
• Following are the surcharge rates under New Tax Regime:

• Health & Education Cess: 4% of the total of Income Tax and Surcharge.

• Deduction under Section 16(ia) in respect of Standard Deduction of maximum INR 50,000.
• The taxable income rebate limit under Sec 87A in the Old Tax Regime is INR 5,00,000, meaning that taxpayers in the Old Tax Regime with income up to INR 5,00,000 will not have to pay any income tax. Hence, taxpayer will get the maximum rebate amount of INR 12,500 under Old Tax Regime.
• Section 87A rebate is applicable for only the taxpayer who is resident in India.
• Section 87A rebate is not applicable for PAN not available cases.
• Following are the surcharge rates under Old Tax Regime:

• Health & Education Cess: 4% of the total of Income Tax and Surcharge.

Notification No. 38/2020-Income Tax dated 26th June 2020- CBDT amended Rule 2BB notifying that a salaried employee who opts for new Concessional Tax Regime can claim following Exempt Allowances as under Section 10(14) of Income Tax Act, 1961:

1. Tour/Transfer Allowance
2. Daily Allowance when on Travel
3. Conveyance Allowance for Duties
4. Transport Allowance for Handicapped

Notification denies benefit of exemption to those who opted for new tax Regime in respect of free food and nonalcoholic beverage which was earlier available even if value does not exceed fifty rupees per meal or to tea or snacks provided during working hour.

Please note that, any actions in any previous years with respect to choice of regimes will not be applicable from FY 2023-2024. You are required to submit Form 10-IEA again in case you want to opt for the old regime.

Yes. The employee must specify the tax regime he/she wants to choose to the employer. However, at the time of filing of ITR, he/she can switch the regime as per their wish and whichever is beneficial to them.

Individuals/HUF with an income from business or profession are not eligible to switch tax regimes every year. However, individuals/HUF having income from sources other than business or profession can switch their regimes every year.

Form 10-IE Previously utilized for opting into new tax regime has been phased out. It was in use until FY 2022-23. Its discontinuation aligns with new tax regime being default regime.

Therefore, there is no requirement of opting for new tax regime for individuals, HUF, AOP (other than Co-operative Society), BOI, and AJP from FY 2023-24 onwards.

Form 10-IEA notified vide Notification No. 43/2023 dated 21st June 2023 is applicable for individuals, HUF, AOP (other than Co-operative Society), BOI, and AJP from FY 2023-24 onwards.

Form 10-IFA notified vide Notification No. 83/2023 dated 29th September 2023 is applicable for Co-operative Society from FY 2023-24 onwards for opting for new tax regime.

In case you don't have any business income and are required to file ITR1 / ITR2, then there is no need to file Form 10-IEA in order to opt out/ re-inter the new tax regime under Section 115BAC of Income Tax Act, 1961. In such case, the option can be exercised while filing the respective ITR form (ITR 1/ ITR 2) on or before the due date specified under Section 139 (1) of Income Tax Act, 1961

Any loss under house property (self-occupied or let-out property) is not allowed to set off against any other head of income. However, intra head set off is allowed, which means loss under self -occupied property can set off against income from let out property under New Tax Regime.

The income from house property will become part of the total income (no changes to this rule even under New Tax Regime).

No. Employee contribution to PF will not be eligible for deduction under Sec 80C if New Tax Regime is opted.

Yes. The income from bank interest and NSC will continue to be added to the total income (no changes to this rule under New Tax Regime). However, no benefit of deduction is available other than 80CCD(2).

Yes. The additional interest benefit of Sec 80EE or 80EEA is available only for the Old Tax Regime

Yes. The deduction u/s 80CCD(2) will be considered for tax benefit.

Yes. The combined cap of INR 750000 per annum has been inserted in respect of the Employer's Contribution to the Employee Provident Fund, National Pension Scheme, and Approved Superannuation Fund schemes and amount more than INR 750000 will be taxed as perquisite in the hands of the employees.