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Professionals in India review the old and new tax regimes every financial year to ensure their tax outgo is optimised under the Income Tax Act, 1961. This decision depends on income level, eligibility for deductions and exemptions, and recent slab changes announced in Budget 2025. While the new tax regime is now the default option with lower slab rates and a higher rebate threshold, the old regime continues to benefit those with substantial deductions. A yearly evaluation hel

Choosing between the old and new tax regimes directly impacts tax outgo, refunds, and long-term planning. With the new tax regime becoming the default and offering tax-free income up to ₹12 lakh after Budget 2025 updates, the decision now depends more on income profile than assumptions. TaxBuddy evaluates both regimes side by side by factoring in income level, deductions, exemptions, and taxpayer category to identify the option that results in the lowest tax liability while r

The new tax regime under Section 115BAC has been the default option for salaried employees since FY 2023–24. While it offers lower slab rates and a nearly tax-free income up to ₹12 lakh after rebate from FY 2025-2026, it removes most commonly used deductions. For salaried individuals with home loans, insurance, or long-term investments, the tax saved through deductions under the old regime often exceeds the benefit of lower slabs. As a result, many employees unknowingly pay h

Wrong tax regime selection under the Income Tax Act, 1961, often triggers demand notices, refund adjustments, or mismatched tax computations. These issues typically occur when deductions under the old regime are claimed without eligibility, or when the new regime is applied without the required forms. Errors by employers or automated portal calculations can further distort the tax outcome. Early correction prevents unnecessary tax demands, and platforms like TaxBuddy simplif

The new tax regime removes most deductions, raising a common question for taxpayers earning interest from savings accounts: is any part of this interest deductible? With 80TTA and 80TTB restricted to the old tax regime, savings interest now falls under fully taxable income when opting for Section 115BAC . Since the Finance Act 2024 made the new regime the default, understanding this shift is essential for planning taxable income accurately and avoiding incorrect claims during

Form 10BA acts as a declaration for individuals claiming rent deductions under Section 80GG when House Rent Allowance is not available. It confirms rent payments, verifies that no residential property is owned at the place of work or residence, and ensures eligibility for the deduction. Section 80GG is specifically designed for salaried and self-employed individuals who pay rent but do not receive HRA, making Form 10BA a mandatory compliance step. Since this deduction applie

House Rent Allowance remains one of the most significant components of tax planning for salaried individuals in India. The rules, however, differ sharply between the old and new tax regimes in 2025. The old regime continues to offer HRA exemption under Section 10(13A) , while the new regime under Section 115BAC has removed this benefit entirely, even if HRA is part of the salary. Understanding how exemption is calculated, who qualifies, and when each regime becomes financia

Choosing between the old and new income tax regimes depends on correct form submission and awareness of the latest rule changes under the Income Tax Act, 1961. Form 10-IE was used earlier to opt into the new regime when the old regime was the default, while Form 10-IEA now serves as the declaration form for taxpayers opting out of the default new regime to choose the old one. These forms ensure accurate tax computation, correct TDS treatment, and smooth filing, especially for

Tax planning for FY 2024-25 revolves around using the revised income tax slabs, maximizing eligible deductions, and aligning investments with the latest Budget reforms. The government’s emphasis on a simplified new regime and increased standard deductions offers individuals more flexibility in optimizing their tax liability. By choosing the right mix of exemptions, salary structuring, and investments, taxpayers can significantly reduce their overall tax outgo while ensuring c

Switching between the  old and new tax regimes  online under the Income Tax Act, 1961 is designed to give flexibility and control to taxpayers. The process differs depending on whether income is from salary, pension, or business/profession. Salaried individuals can change regimes each year during ITR filing, while business or professional taxpayers must file Form 10-IEA before the ITR deadline. These changes reflect the government’s intent to simplify compliance and make regi