Advance Tax is a method of spreading out the payment of income tax over the course of the financial year, rather than making a single payment at the end. This system applies to individuals, freelancers, self-employed professionals, and businesses who owe more than Rs. 10,000 in taxes.

What is the deadline for paying Advance Tax?

The deadline for Advance Tax payment applies to individuals and businesses who are obligated to pay Advance Tax and have chosen the quarterly payment scheme.
Tax payments are made in installments on specific due dates throughout the financial year. The due dates for Advance Tax payment are as follows:

• June 15th: 15% of the total tax liability must be paid by this date.
• September 15th: By this date, 45% of the total tax liability should be paid.
• December 15th: 75% of the total tax liability should be paid by this date.
• March 15th: The remaining 100% of the total tax liability should be paid by this date.

How is Advance Tax calculated?

The calculation of Advance Tax depends on an individual’s projected income for the fiscal year and the corresponding tax rates. It is recommended to seek advice from a tax expert or utilize the income tax calculator offered by the Income Tax Department of India to accurately determine the required payment.

Consequences of Missing the 15th June Deadline for Advance Tax Payment

Failing to meet the deadline for Advance Tax payment can result in penalties and interest charges as per Section 234B and 234C of the Income Tax Act. It is crucial to make the payment prior to the due date to prevent incurring such penalties.

Can I modify my Advance Tax payment if there are changes in my income estimates?

Certainly! If you discover that your estimated income has undergone significant changes, you have the option to revise your Advance Tax payment in the subsequent installments. It is advisable to seek guidance from a tax expert to ensure precise revisions and prevent any discrepancies.

How can I make the Advance Tax payment?

You have the option to pay Advance Tax either online through the website of the Income Tax Department or offline at designated banks. When paying online, you can choose from various methods such as internet banking, credit/debit card, and NEFT/RTGS. For offline payments, you can submit the challan at authorized bank branches.

Is there any benefit to paying Advance Tax?

Paying Advance Tax enables you to effectively handle your tax obligations and prevent unexpected financial pressures at the last moment. It also aids in meeting tax regulations promptly and reduces the risk of incurring penalties and interest charges.

Can I seek professional assistance for Advance Tax payment?

It is strongly advised to obtain professional help from a tax consultant or a chartered accountant to ensure precise calculation, timely payment, and compliance with Advance Tax obligations.

Steps to Make Online Advance Tax Payment

Follow these steps:

Step 1: Visit the official website of TIN-NSDL.

Step 2: Navigate to the ‘Services’ section and select e-payment.

Step 3: Choose Challan 280a, which is used for paying advance taxes.

Step 4: Fill in the necessary information, such as bank name, email ID, address, phone number, and the assessment year.

Step 5: Enter the CAPTCHA code provided.

Step 6: The next screen will display your bank’s net banking page, where you can review the tax amount.

Please be aware that the information provided here is a general guideline and may differ based on individual circumstances. It is recommended to seek advice from a tax professional or consult the official website of the Income Tax Department of India for the most precise and current information.

In this article, we will discuss the fundamental ways to educate children about work, expenditure, and savings. Our recommendations are applicable to children of all ages, from toddlers to teenagers. We will advise on how and when to introduce budgeting to your children, as well as provide essential information on financing college.

Teaching Children the Fundamentals: Work, Spending, and Saving

It is crucial to teach your kids the connection between work and earning money. This is a fundamental concept that you can start teaching at a young age. Instead of giving them an allowance, consider using a commission format to directly teach the relationship between hard work and earning money. You can start by giving your child the opportunity to earn a few Rupees for simple chores like making their bed, putting away toys, or carrying lighter items. Pay them immediately after completion of the chore and store the money in a clear jar using single dollar bills to create excitement.

As your child grows older, increase the difficulty of the chores and introduce the envelope system for saving, spending, and giving to charity. Start with teaching them wise spending habits like looking for bargains and considering the opportunity cost of spending. As they get older, introduce wise saving habits like saving for bigger purchases. Keep in mind that everyone has a natural inclination towards spending or saving, but it is essential to adhere to wise habits regardless.

students who demonstrated good financial skills reported that they had learned the habits based on their parents’ guidance when they were younger. Therefore, teach your kids saving and spending habits early, and they will carry these skills with them throughout life.

Budgeting

A budget is a careful plan and accounting of all the money you handle during a given time period, including income, money spent, money saved, money gifted, taxes paid, and so on. By consistently practicing good budgeting habits and teaching your children to do the same, you can help them become financially savvy.

As with spending and saving habits, you’ll need to adjust your teachings about budgeting to your child’s age. For younger children, you might let them handle your checkbook or play next to you as you budget. As they grow, you can give more in-depth explanations of a budget and expect more from them in terms of having their own budget. Even if your child isn’t working a job, you can help them learn how to budget by depositing an amount into a checking account and allowing them to handle their expenses during the month.

It’s important to be gracious with your child, but also to let them learn from their mistakes. If they dip into their emergency fund for an unnecessary purchase, consider not bailing them out. On the other hand, if they have put in a huge effort to save up for a big purchase but forgotten about tax, it’s perfectly fine to pay the extra bit for them. By consistently practicing good budgeting habits and teaching your children to do the same, you can help set them up for a financially secure future.

College

Many parents stress about how to cover the high costs of tuition. While it is acceptable to do so if financially able, there are other ways for children to graduate from college without going into debt.

One crucial factor in avoiding debt is to start planning early. Talk to your child about how much you can afford to contribute towards their education. One significant way to make college affordable is to choose an in-state, public university. Encourage your child to apply for as many scholarships as possible, even small amounts can add up. Help them identify available scholarships and awards they can apply for, such as writing essays etc .Earning and saving money is also essential in preparing for college.

In summary, there are many ways for children to graduate from college without going into debt.. By providing support and guidance, your child can achieve their educational goals without incurring debt.

Summary

Money is a crucial aspect of our lives, and it is neither good nor bad. Its value depends on the way it is used. Educating your child about money management is not an easy task. In fact, raising a child is challenging. However, with the guidelines provided in this Blink, you are now equipped to assist your child in becoming financially literate.

You can start and modify the money discussion with your children based on the foundation you have acquired. Keep in mind that these are significant topics that require patience and persistence. Lead by example and initiate the teachings at a basic level that matches your child’s age.

Finally, allow your children to make mistakes. It is better to guide them through these experiences now, while you are there to assist them, than to let them face the consequences alone later in life.

Advantages:

1. Simplification of tax structure :
The new system reduces the number of tax slabs and exemptions, making it easier for taxpayers to understand and comply with the tax laws. This can save time and money for individuals and businesses alike.

2. Lower tax rates for some taxpayers:
The new regime offers lower tax rates for those who are willing to forego most of the exemptions and deductions. This can reduce the tax burden on those who have fewer income sources or deductions, and encourage more people to file their tax returns.

3. Increased Revenue:
A new tax regime may result in increased tax revenue for the government, which can be used to fund public services and infrastructure.

4. Reduced Tax Evasion:
A new tax regime may incorporate measures to reduce tax evasion, such as improving tax collection and enforcement mechanisms.

5.Boost to consumption and investment:
The lower tax rates and higher take-home pay of taxpayers can potentially stimulate demand for goods and services, and encourage more savings and investments in the economy. This can create more jobs and generate more revenue for the government in the long run.

Disadvantages:

1. Loss of exemptions and deductions :
The new system requires taxpayers to give up most of the exemptions and deductions they used to claim, such as those for home loan interest, medical expenses, and charitable donations. This can hurt those who depend on such benefits and reduce their disposable income.

2. Complexity of choice:
The new system offers taxpayers a choice between the old and new tax regimes, depending on their eligibility and preference. This can create confusion and uncertainty for taxpayers, as they may not know which system is better for them and may have to calculate their tax liability differently.

3. No carry forward of losses:
Under the old tax regime, taxpayers could carry forward losses from previous years and use them to offset future profits. However, under the new tax regime, this benefit has been removed.

4. Reduced benefit for home loans:
Taxpayers who have taken home loans can no longer claim deductions for the interest paid on the loan. This can significantly increase the tax liability for such taxpayers.

Conclusion:

Overall, the new tax system has both pros and cons, and its impact on the economy and society may vary depending on many factors. It is important for taxpayers to understand the implications of the new system and make informed decisions about their tax planning and compliance. It is also important for the government to monitor the performance of the new system and make necessary adjustments to ensure its fairness and effectiveness.

Before switching to the new tax regime, taxpayers should evaluate the impact of the new tax regime on their tax liability. They should compare their tax liability under the existing tax regime and the new tax regime and choose the one that offers them the best tax benefit. Taxpayers should also consider their income sources, deductions, and exemptions before choosing between the two tax regimes.

Taxpayers who have already made investments in these instruments should evaluate the impact of the new tax regime on their investments. They should also consider the long-term benefits of these investments before switching to the new tax regime.

Before switching to the new tax regime, taxpayers should 4 key considerations before switching to new tax regime-

1. Home Loan Interest Deduction for Rented Property Owners
Under the new tax regime, individuals can only claim a deduction for interest paid on their housing loan if the property for which the loan was taken is rented out. It’s important to note that this deduction is limited to the amount of rent received. If the rent charged is lower than the interest amount, any resulting loss cannot be offset with any gains or carried forward. As a result, taxpayers should factor in their home loan interest costs and assess whether the new tax regime is the best option for them. This cost may vary depending on the type of home loan taken.

2. Annual Regime Switch for Non-Salaried Individuals

If your only source of income is your salary, you have the option to switch between tax regimes every year. However, those who have income from a business may not always be able to make the switch. It’s important to note that it’s recommended to compare the different tax regimes before making the switch. For those with business income, it may be difficult to switch back to the previous regime once they drop out.

3. Ensure Switch to New Regime for 2022-23: File ITR by 31 July

If an individual intends to transition to the new tax regime for the financial year 2022-23, it is obligatory to file the original income tax return by July 31, 2023. It is prudent to exercise caution and be mindful of the tax regimes while filing the initial ITR. If a taxpayer submits an original ITR under the old tax regime but subsequently files a revised ITR under the new tax regime, the tax department may disallow such claims. Starting from the year 2023-24, the new tax regime will become the default regime.

4. Certain losses are non-adjustable and cannot be carried over

To reduce tax liabilities arising from short-term capital gains, taxpayers often turn to loss harvesting. This involves booking losses on existing investments in order to offset gains made on other investments, thereby lowering the overall tax payment. Once the losses have been booked, the investments are bought back at market price to maintain the desired asset allocation plan. However, under the new tax regime, this strategy cannot be applied to certain assets.
The new tax regime imposes restrictions on carrying forward and setting off certain losses. As a result, for those with carry forward losses from the previous year, it may be more beneficial to opt for the old tax regime instead of the new one. One such restriction under the new tax regime pertains to income from house property, which cannot be set off with any other heads of income, nor with any loss or depreciation from any earlier assessment year.

In summary, loss harvesting remains a popular tax planning strategy, but its applicability is limited under the new tax regime. Taxpayers should be aware of these restrictions and carefully consider their options when planning their tax liabilities.

In order to become financially successful, one must adopt a smart work. They must be passionate about growing their wealth and always be on the lookout for new ways to increase their financial worth. By doing so, they can reach their financial goals and become financially successful.

1. Smart Saving Habits

While saving money is important, relying solely on savings can lead to financial difficulties, especially in case of emergencies. To truly achieve financial stability, it’s important to not only save money, but also to regulate expenses and invest for the long-term.
To start, begin by regulating expenses by adopting a modest lifestyle, where you focus on getting the best value for your money. One example of this is following in the
footsteps of successful individuals like Warren Buffet, who despite his immense wealth, still lives in an average house and focuses on curbing unnecessary expenses.
To save money, it is helpful to create a separate savings account that is designated solely for savings. Decide on a percentage of your monthly income to go into this account before you start spending.
In addition to saving money, it’s important to invest your money to multiply your net worth and reach your financial goals. This can be done by researching investment opportunities and allocating a portion of your savings into various investments.
To make saving a habit, consider automating the process through a standing order with your bank. This will automatically transfer a fixed amount of money from your spending account to your designated savings account on a regular basis. By taking these steps, you can simplify your personal finance and better reach your financial goals.

2. They Don’t Rely on Loans

The wealthy have a different perspective when it comes to loans. They view taking out loans to support their lifestyle as a poor person’s practice, and even extend this viewpoint to include credit card debts. According to legendary billionaire Warren Buffet, “It’s easy to be tempted to spend more than you earn, but it’s not a wise decision.”

In an interview, Buffet warned people about the dangers of debt and advised, “Never use a credit card again if you are already in debt.” The debt trap is a fear shared by even the wealthiest, which is why it’s important to pay off your debts as soon as possible.

Instead of focusing on earning more, it’s recommended to prioritize paying off debts. This approach is simple yet effective when evaluating your net worth. Paying off a loan with a 12% interest rate is equivalent to earning a 12% return on your investment.

3. Setting SMART Goals for Success

If you’re looking to build financial confidence, it all starts with setting a budget, keeping track of your spending, and setting achievable financial goals. This will help you develop a sense of self-efficacy, or confidence in your ability to handle difficult financial situations. To maximize the impact of your goal setting, it’s helpful to follow the SMART criteria, which means your goals should be Specific, Measurable, Achievable, Relevant, and Time-bound.

For instance, a realistic financial goal might be to pay off a $2,000 credit card balance in 10-12 months. This goal is specific, as it involves paying off a specific debt. It’s measurable, as you can track the decline of the balance. It’s achievable, as you have the resources to pay an extra $150 per month above the minimum payment. It’s relevant, as it will eliminate the debt and it’s time-bound, as you have a deadline to achieve it.

Once you’ve successfully achieved this goal, you can set another, or a bigger one, as long as it follows the SMART criteria and is achievable. By seeing yourself succeed, you’ll build confidence and empowerment, allowing you to set and achieve even more financial goals.

4. Hire Financial Advisors

They takes help of financial coaches to achieve their financial goals ,get valuable advice and guidance,they take their help to understand the financial products and services available and get a clear and unbiased perspective on financial matters.
If you are looking to take control of your financial future, working with a financial advisor can be a great first step.

THE FINISH LINE

Investing is not just for the wealthy or the elite. For those who aspire to be an investor, it is important to remember that the road to financial success is a never-ending journey. To reach your financial goals, it’s crucial to have a clear mind, be patient, and persist through challenges. By applying these principles, you will find that the investor lifestyle will reward those who remain persistent. Your willpower is the only barrier to achieving financial success. So, don’t stop at the finish line, instead start actively planning for your financial future.

SECRETS THAT ARE HIDDEN FROM YOU
Uncovering the Hidden Truths About Money and the Economy That Prevent You from Achieving Financial Success

1. Circular Running Path: Your Journey

Are you struggling to reach your financial goals despite your hard work and improved professional skills? It may seem like the more effort you put in, the further away you are from your financial objectives. The truth is, working hard and earning more is only a part of the equation. Without proper Financial Roadmap, you’ll find yourself trapped in a never-ending cycle of stress and frustration.

Your lack of Financial Roadmap is the root of your financial problems. Even with increased pay and improved job performance, the same stress is chasing you. This can take a toll on both your mental and physical well-being, leading to losses in both your personal and professional life.

To avoid this, it’s crucial to take the time to plan your finances effectively. This will ensure that your hard work and efforts result in the financial success you desire. Don’t let the lack of proper planning hold you back from reaching your goals.

2. Banks Not Aligned with Helping You Achieve Your Financial Goals

While banks offer a variety of services, they may not always have the goal of helping individuals achieve their financial goals. One example of this is credit card services, which can lead to a debt trap. The “buy now, pay later” mentality can be alluring, but it can cause individuals to spend a large portion of their income on credit card debt each month.
Additionally, loans offered by banks can also contribute to a financial burden. While loans can provide opportunities for individuals who wouldn’t have them otherwise, it’s important to keep in mind that one wrong decision can lead to falling into a debt trap. The loan application process can be portrayed as difficult, which can make it seem like a privilege to be eligible for a larger loan. However, having multiple loans and paying multiple EMIs can be a huge financial burden.
It’s crucial for consumers to be aware of these traps and make financial decisions that align with their financial goals, rather than solely relying on banks’ services or offers.

3. Marketing Tactics that Encourage Overconsumption and Drain Your Finances

Businesses and sellers actively participate in this by manipulating demand and influencing societal norms to make even unnecessary purchases appear as essential needs.
Many consumers, who are not actively involved in budgeting and monitoring their expenses, fall prey to these tactics. They can be swayed by limited-time offers and the perception of saving money, ultimately leading to unnecessary spending.
Furthermore, societal pressures also play a role in this cycle of overconsumption. People often feel compelled to keep up with the lifestyles of their neighbors, colleagues and relatives, leading them to purchase things they may not need or cannot afford.
Marketers are particularly skilled at getting into consumers minds and manipulating them into buying things they don’t need, or things that are not good for them. This ultimately results in a serious drain on their finances. It is important for individuals to be aware of these tactics and actively make their own purchasing decisions rather than being influenced by these market forces.

4. Saving Alone Not Enough to Secure Your Financial Future

Saving money is often viewed as a straightforward idea, but the reality is that inflation can complicate the matter. While depositing money in a savings account may lead to interest earnings, inflation, or the continuous rise in the cost of goods and services, can diminish the buying power of that money.

As a result, the value of the savings may decrease even though the amount in the account increases. To maintain the same purchasing power, one must save more money to offset the impact of inflation.

Therefore, it’s crucial to take inflation into account when saving for the future and to explore various saving and investment options that can help preserve the value of your money.

5. The Illusion of Ownership: The Reality of Your Assets

The assets that you own may not truly be yours. They are often a part of a larger scheme in which financial institutions play a role in creating the illusion that you own these assets in order to achieve your financial goals.
As you strive to accumulate wealth and achieve your financial goals, you may find yourself buying things that you believe will help you get there. However, the reality is that many of these assets come with the cost of long-term debt. This is similar to the debt trap mentioned before, which can prevent you from truly owning your assets.
Additionally, the worth of most assets will decrease over time, meaning that in the long-term, you may not see any real benefits from owning them. This is especially true if you are unable to pay off your EMI(s) and may end up losing the assets, leaving you in a worse financial situation. This is important to keep in mind as you plan and make decisions about your finances, and be aware that owning assets is not equal to achieving your financial goals.

When planning for an efficient tax proposition, take into account your parents who can play a crucial role in the same. Adults have the luxury when it comes to basic tax exemption limits and so does your parents. Particularly when they are above 60 years of age, they fall under the Senior Citizens category for tax calculation purposes. They are eligible for a tax exemption limit of 3 Lakhs per year. When one or both your parents are not in the high-income bracket, you can use this non-taxable status of theirs to your benefit. Make investments in their names which will not be considered as your taxable income but theirs.

Even if you gift them, the same will not be taxed & Invest in All those avenues where income is tax exempt.You can invest in your parents’ name through the Senior Citizen Savings Scheme if they are above 60 years of age but will be taxable. The yield out of this investment will be at higher than other Fixed Investment Avenues. You can consider investing in the Public Provident Fund (PPF) on your parent’s name the income out of which is totally exempt from tax. A maximum of Rs. 1,50,000/- can be invested in your each parent name every year if you have invested to the maximum limit in your name. You may also consider investing in Mutual Funds on your parents’ name. As long as you do not cross the basic exemption limit,capital gain will not attract the tax at any point of time.

If the property you are dwelling in belongs to your parents then you can pay rent to them. Ensure that the property is in your parent’s name before going in for this option. If the property in the name of both your parents, it eases out the taxation front to a major extent. Assuming that you are paying a rent amount of Rs. 25,000/- per month to your parents, for a year it is 3 Lakhs. Taking into consideration 30% deduction, the taxation limit will be just 2.10 Lakhs which will be added to their taxable income. If your parents are not earning and the rent is their only income it is a nil tax scenario in this case. If their overall taxable income exceeds their exemption limit, help them invest the same in PPF, Mutual Funds or Senior Citizen Saving Scheme.

Under Section 80D of the Income Tax you can claim up to Rs. 25,000/- deduction for Premium paid For Parents every year. Get your parents a health insurance policy which is one of the simplest ways to save on tax. If your parents are above 60 years of age and fall under the senior citizens category, the deduction is Rs. 50,000/- per annum.

This tax deduction on Heath Insurance policy for your parents can be availed over and above claiming one for Your family.Tax deduction for investment in Health Insurance for parents can be claimed even if your parents are not financially dependent on you.

The taxmen do not have any objections when it comes to spouses sharing each others’ funds in a mutual manner. Irrespective of whether the money belongs to the husband or the wife, they are permitted to handle each other’s money without any tax implications. Such mutual finance sharing between the spouses does not attract any gift tax. However, when the combined money is invested in any form yields return on the same, the returns are taxable.

when a spouse gifts money to his better half it is considered as the income of the giver. He will be taxed for the same during the Assessment year. Let us understand this concept in a clear manner through an example. The husband purchases a property in the wife’s name and the wife has not made any financial contribution for the purchase. Any income like Rent or Lease Amount earned through the property will be added to the income of the husband. The applicable tax slab will be as per the Husband’s total earning during the fiscal year. In the same wave length, when the husband invests the money on his wife’s name in financial instruments like Fixed Deposits. The interest earned from such deposits which is taxable would be added to the husband’s taxable income for the year.

One of the common misconceptions for tax evasion is to route funds to the spouse through some other relatives. For instance, say you gift a specific amount to your sister-in-law and she in turn gifts the same to your wife after a few days. Your wife receives the gifted money from your sister-in-law and invests the same in a financial instrument. Will this round about dealing attract tax? Of course yes. Right from financial institutions to tax offices, insurance companies and Mutual Fund brokerages share all investor details with the Income Tax Department. This will complicate things for you even when you route your finance through relatives to your spouse. Remember, the tax men can easily understand that your money has gone on a circular route and returned back to you intact. So when found out, you may be filed for tax evasion.

Now, the question you may ask is if such finance clubbing between spouses can be done without adding tax burden on the husband. Yes. It can be done. Let us understand this through an example. Say you want to purchase a property in your wife’s name, but she is not financially contributing to the same. In such cases, you can lend her the property worth as loan to your wife. In return she can transfer her jewellery to you worth the loan amount you give her. This will relieve you of the tax burden since any income generated by this investment will not be added to your taxable income.

Let us now look at another manner in which you can get relieved from tax burden. Go in for Public Provident Fund and similar investment options which are exempted from tax. The deterring factors in investing in the tax exempt options like PPF is long lock in periods. You can invest in Mutual Funds and Shares whose returns are tax exempted when held for more than a year period(upto 1 Lakh Capital gain).

The taxmen, for sure, understands certain practical financial nuances between the spouses. When a wife saves money from what her husband offer to her for household expenses, this is considered as her own money. She is liable to pay the tax for the return on investment she receives using this savings amount. The interest thus earned is not clubbed with the overall income of the husband for taxation purposes. However, the limit of such savings by the wife is fixed and the same needs to be taken into consideration while making investments.

The interesting aspect of clubbing the finances is that the same can be done even when a man and a woman get married. Let us assume that a man and a woman are engaged to each other and awaiting to get married. The would-be husband can transfer an amount not exceeding Rs.5 Lakhs to his fiancé. If this would-be wife does not earn or does not fall under the tax bracket, Rs. 5 Lakhs will be totally exempted from tax for her. This amount will not be included in the taxable income of the man to be married too. Remember, this 5 Lakhs is nothing but the tax exempt limit for women as per IT rules.

Ensure that you declare the income earn from investments on your child’s name when you file your tax returns. If the minor child earns his money all by himself, he can file tax returns on his name. In such cases the income earned from the investments on the child’s name will not be clubbed with that of the parent.

Invest in tax free financial products like ULIP, Mutual Funds(upto 1 Lakh Gain) and PPF to avoid clubbing your income with that of your minor child.

Remember, income earned through investments in Fixed Deposits or National Savings Certificate in your child’s name attracts tax. Such income is clubbed along with yours and tax calculated accordingly. Creating a Private Trust can help you save on tax. However, the process involved in creating one can be demanding.

Considering all such options available to save tax, we recommend investing in ULIP,PPF and Mutual Fund(Gain upto 1 Lakh) which attracts nil tax. It will also save you from issues like clubbing of income or filing separate or combined income tax returns.

New Income Tax structure for 2020 – 2021 has been released in the latest budget session presented by the Finance Ministry recently. At the outset the new budget appeared very Taxpayer friendly as it gives feeling of lower tax liability. Diving deep in to the many aspects of the budget did we understand that it was a lot more complicated than we initially thought.

The new tax structure does not allow all tax payers to benefit out of the same but only those who are willing to forego the exemption clause.

As per the new structure, the tax payers need to do two types of calculations one with tax deductions and another without the same.

1. Tax Payers who are willing to claim IT Deductions and Exemptions(Old Tax Regime)
2. Taxpayers who are unwilling to claim IT Deductions and Exemptions(New tax Regime)

govt has given option to tax payers to Continue with popular Tax exemption like 80C, 80D,80 CCD (NPS), Standard deduction, housing loan interest,Principal Repayment,HRA (Total 100 Exemptions) with Last Year tax structure(FY20-21).

The below deductions, exemptions the earlier tax structure offered have been scrapped from the new one.If you wish to forgo these below exemptions then you can avail the New tax structure proposed in Budget

(i) Section 16 – Standard deduction and deduction towards entertainment allowance and employment/professional tax (ii) Clause VIA sections All deductions 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA,
80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, etc).

(iii) Sub-section (2) of section 23 – Interest under section 24 towards self-occupied or vacant property(Home Loan Interest Deduction).

(iv) Clause (13A) of section 10 House rent allowance

(v) Clause 5 of Section 10 – Leave travel concession

(vi) Clause (2a) of section 57 – Deduction from family pension

(vii) Specific allowances in Clause (14) of section 10

(viii) Sub-clause (2) or sub-clause (2A) or sub-clause (3) of sub-section (1) or sub-section (2AA) of section 35 – All deductions towards donation or expenditure for Scientific Research.

(ix) Clause (2A) of sub-section (1) of section 32 – Additional depreciation

(x) Section 32AD, 33AB, 33ABA – All applicable deductions

(xi) Clause (32) of section 10 – Allowance for income of minor

(xii) Deduction under section 35AD or section 35CCC;

(xiii) Section 10AA – Exemption for SEZ unit

(xiv) Clause (17) of section 10 – Allowances to MPs/MLAs

Let us now look at some exemptions and deductions that can be claimed under the new tax structure

• Deduction under Sub-section (2) of section 80CCD (Employer contribution towards Employee Pension Scheme) and Section 80JJAA towards new Employees
• All retirement benefits that includes Gratuity
• Pension commutation
• Leave Encashment at the time of Retirement
• Retrenchment Compensation
• VRS benefits
• Employer contribution of EPFO
• NPS Withdrawal Benefits
• Educational Scholarships
• Payments towards Awards instituted in public interest

Which tax regime is beneficial depend upon income composition,Exemptions to be      claimed  & investments done.Each individual has to do his own calculation based on his saving habits,Living on Rent or Self Occupied House etc & figure out.however we have figured Some General Calculations below with 25 Lakh,15 Lakh and 10 Lakh of Salary Income.Detailed Table Mentioned Below.

Income Tax Slab Rate for FY 2020-21

As per announcement New Income Tax Slab for FY 2020-21 is given below.

In our View It should be Better to continue with Old Tax Structure with Exemptions on there Side as it is clearly  visible on taxation front that the New Tax Slab(optional) that individual has to shell out more taxes ,We as a Financial Consultant Believe with Forced tax saving People start their Saving Habits.It goes a Long way to help people achieve Financial Freedom.So there is No Change/Benefit for People For Taking Exemptions.

However you can calculate Your Suitability by checking on below Link

https://www.incometaxindiaefiling.gov.in/Tax_Calculator/