The Government of India allows taxpayers to choose between two regimes every financial year. While the New Tax Regime is now the default option, you can still opt for the Old Regime if it provides better savings through traditional deductions.
| Income Slab | New Regime (Default) | Old Regime (Optional) |
|---|---|---|
| Up to ₹3.0 Lakh | Nil | Nil (up to ₹2.5L) |
| ₹3.0L - ₹7.0 Lakh | 5% (Tax-free up to ₹7L*) | 5% |
| ₹7.0L - ₹10.0 Lakh | 10% | 20% |
| ₹10.0L - ₹12.0 Lakh | 15% | 30% |
| ₹12.0L - ₹15.0 Lakh | 20% | 30% |
| Above ₹15.0 Lakh | 30% | 30% |
*Under Section 87A, individuals with total income up to ₹7 Lakh pay Nil tax in the New Regime due to a full tax rebate.
Standard Deduction is ₹75,000 (for Salaried/Pensioners only). Focuses on lower rates without specific investment-based exemptions.
Ensures savings for those who claim 80C, 80D, HRA, and Home Loan Interest. Best suited for high-liability individuals.
An HUF is a separate taxable entity. While tax slabs for HUF are identical to those of individuals, there are critical differences in benefits and deductions.
| Income Slab | New Regime (HUF) | Old Regime (HUF) |
|---|---|---|
| Up to ₹2.5 Lakh | Nil | Nil |
| ₹2.5L - ₹3.0 Lakh | Nil | 5% |
| ₹3.0L - ₹5.0 Lakh | 5% | 5% |
| ₹5.0L - ₹7.0 Lakh | 5% | 20% |
| ₹7.0L - ₹10.0 Lakh | 10% | 20% |
| Above ₹10.0 Lakh | 15% to 30% | 30% |
HUF is NOT eligible for the ₹75,000 Standard Deduction. This benefit is reserved for salaried individuals and pensioners.
The "Zero tax up to ₹7L" rebate is NOT available to HUFs. Tax is payable on all income above the primary exemption limit.
HUFs can claim deductions for insurance premiums paid for members, but only under the Old Tax Regime.
Insurance products are cornerstones of both financial security and tax efficiency in the Old Regime.
Premiums for life insurance (Self/Spouse/Kids) are deductible up to ₹1.5 Lakh per year. This includes Term, Endowment, and Whole Life plans.
Deductions on Mediclaim premiums:
Life insurance maturity proceeds remain 100% Tax-Free provided the annual premium is less than 10% of the sum assured (u/s limits).
How your capital gains are taxed depends on the asset type and holding period.
| Product | Short Term (STCG) | Long Term (LTCG) |
|---|---|---|
| Equity Mutual Funds | 20% (if sold < 1 year) | 12.5% (above ₹1.25L gain) |
| Debt Mutual Funds | As per Income Slab | As per Income Slab |
| ULIPs | Nil (u/s 10(10D))* | Nil (u/s 10(10D))* |
| Listed Bonds | Income Slab (Interest) | 12.5% (Without Indexation) |
*ULIPs are tax-free if the aggregate annual premium does not exceed ₹2.5 Lakh. For higher premiums, they are taxed like equity MFs.
Maximize your "Keep" amount by leveraging instruments that offer zero tax on investment, interest, and maturity.
One of the most trusted tax-free tools. Interest and maturity are 100% exempt from tax. Limit: ₹1.5L/year.
Specialized for the girl child. Entire corpus, including interest, is exempt from tax on maturity.
Proceeds from most insurance policies remain tax-free wealth generators for your family's future needs.
India provides significant relief to senior citizens through higher exemptions and specific deductions.
Exemption limit is ₹3 Lakh for seniors (60-80 yrs) and ₹5 Lakh for super-seniors (80+ yrs) under the Old Regime.
Medical insurance premiums and even medical expenses (if no insurance) are deductible up to ₹50,000.
Senior citizens don't pay tax on interest income from banks/post offices up to ₹50,000 per year.
Don't miss out on these common deductions before the March 31st deadline.
Have you utilized the full ₹1.5 Lakh limit with LIC, PPF, or ELSS?
Claim up to ₹50,000 extra by paying health insurance for your senior parents.
Claim a deduction of ₹5,000 for medical checkups within your 80D limit.
Invest an extra ₹50,000 in NPS under section 80CCD(1B) beyond the 80C limit.
