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News18
6 days ago
- Business
- News18
Income Tax Slabs: Old Vs New Tax Regime, Which One Should You Choose For ITR AY2025-26?
The income tax department has extended the last date for filing income tax returns for FY 2024-25 till September 15, 2025. Here are the slab rates applicable to the ongoing ITR. ITR Filing: Old Tax Regime Vs New Regime. Old Income Tax Regime Vs New Regime: The income tax department has extended the last date for filing income tax returns (ITR) for FY 2024-25 till September 15, 2025, giving taxpayers an extra 45 days beyond the earlier July 31 deadline. The Central Board of Direct Taxes (CBDT) said the move comes 'due to significant changes introduced in the notified ITRs and considering the time required for system readiness and rollout of ITR utilities for Assessment Year (AY) 2025-26". New Tax Regime Remains Default For FY 2024-25 filings, the new tax regime will be the default option. Salaried individuals can still opt for the old regime at the time of filing. However, a belated ITR — filed after the due date — can only be submitted under the new regime. Income (₹) Tax Rate (%) 0-3,00,000 0 3,00,001-7,00,000 5 7,00,001-10,00,000 10 10,00,001-12,00,000 15 12,00,001-15,00,000 20 Above 15,00,000 30 Key benefits: Standard deduction: Rs 75,000 for salaried and pensioners. NPS deduction: Salaried employees can claim up to 14% of basic salary under Section 80CCD(2). The government's recent announcement of 'zero tax on incomes up to Rs 12 lakh" applies only to FY 2025-26 (income from April 1, 2025 to March 31, 2026) and does not impact the current filing year. Old Tax Regime Slabs for FY 2024-25 The old tax regime is the income tax system that offers a wide range of exemptions and deductions, allowing taxpayers to reduce their taxable income by claiming benefits such as Section 80C (up to Rs 1.5 lakh) for investments in PPF, ELSS, LIC, etc; house rent allowance (HRA); leave travel allowance (LTA); interest on home loan (Section 24); health insurance premium (Section 80D); education loan interest (Section 80E); and standard deduction (Rs 50,000 for salaried individuals). Below 60 years: 60 to below 80 years: 80 years and above: Which Tax Regime Should You Choose? The right regime for you depends on how much you earn, how much you invest or spend on eligible deductions, and your preference for simplicity vs savings. As a thumb rule, choose the new regime if you have fewer deductions and want simplicity, he added. Taxpayers are advised to use the income tax department's calculator or consult a tax advisor to make an informed choice before filing your ITR for AY 2025-26. view comments First Published: News business » tax Income Tax Slabs: Old Vs New Tax Regime, Which One Should You Choose For ITR AY2025-26? Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Mint
6 days ago
- Business
- Mint
ITR Filing: Income tax slabs for salaried individuals under new regime and old regime
The Income Tax (I-T) Department has extended the deadline for filing income tax return (ITR) for FY 2024-25. The revised due date is now September 15, 2025, extended from the original deadline of July 31, 2025, giving taxpayers an extra 45 days to complete their filings. The Central Board of Direct Taxes (CBDT) extended the deadline for filing returns due to significant changes introduced in the notified ITRs and considering the time required for system readiness and rollout of ITR utilities for Assessment Year (AY) 2025-26. The new tax regime is the default option for taxpayers. Salaried individuals can opt out and choose the old regime if they wish to while filing ITR for FY 2024-25. A belated ITR, submitted after the due date has expired, can only be filed under the new tax regime. Income tax slabs under new tax regime Income slabs (in INR) Income tax rate (in %) 0-3,00,000 0 3,00,001-7,00,000 5 7,00,001-10,00,000 10 10,00,001-12,00,000 15 12,00,001-15,00,000 20 15,00,001 and above 30 Source: Income Tax Department Standard deduction: Under the new tax regime, salaried individuals and pensioners can claim a standard deduction of ₹ 75,000 from their salary or pension income. 75,000 from their salary or pension income. Section 87A rebate: Under the new tax regime, a resident individual whose net taxable income does not exceed ₹ 7 lakh is eligible for a tax rebate of up to ₹ 20,000. This effectively means zero tax liability for those individuals whose taxable income does not exceed ₹ 7 lakh. NPS contribution: Salaried employees can also claim a deduction of up to 14% of their basic salary under Section 80CCD (2) if they opt for the new tax regime when filing the ITR. It's important to note that the government's announcement of zero tax on incomes up to ₹ 12 lakh applies to the current financial year, 2025-26. Hence, this is not applicable to the current ITR filing for FY 2024-25 and will only exempt tax on the income earned between April 1, 2025 and March 31, 2026. There is no change that has been announced in the income tax slabs under the old tax regime. A taxpayer can choose to opt for this regime while filing their ITR on or before the due date. The slabs depend on the taxpayer's age in FY 2024-25, i.e., between April 1, 2024, and March 31, 2025. Income tax slabs for people below 60 years Income slabs (in INR) Income tax rate (in %) 0-2,50,000 0 2,50,001-5,00,000 5 5,00,001-10,00,000 20 10,00,001 and above 30 Source: Income Tax Department Income tax slabs for people aged above 60 years but below 80 years Income slabs (in INR) Income tax rates (in %) 0-3,00,000 0 3,00,001-5,00,000 5 5,00,001-10,00,000 20 10,00,001 and above 30 Source: Income Tax Department Income tax slabs for people aged over 80 years Income slabs (in INR) Income tax rate (in %) 0-5,00,000 0 5,00,001-10,00,000 20 10,00,001 and above 30 Source: Income Tax Department
Mint
22-07-2025
- Business
- Mint
Top 5 income tax saving options with low or no lock-in periods
As the date of income tax submission nears, taxpayers across the country are actively seeking ways to bring down their taxable income without locking in their funds for years. While many popular investment instruments such as Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS) among others require long term commitments, several provide quick liquidity, lower risk and efficient Section 80C or other related deductions, thus making them ideal for those aspiring to prioritise financial flexibility. Keeping the same factors in mind below are five tax saving options that investors can avail without decadal or very long lock in periods and ensure that they are able to save money smartly. Several banking institutions provide 5 year tax saving fixed deposits (FDs) under Section 80C. Given these fixed deposits do have a five year lock in period, still they also provide premature liquidity in emergencies through a personal loan or overdraft, unlike PPF or NPS. Do keep in mind, the interest earned on such deposits is taxable, but the principal invested qualifies for deduction up to ₹ 1.5 lakh. Health insurance continues to be a reputable tax saving recommendation by banking institutions and financial advisors. Premiums of up to ₹ 25,000 ( ₹ 50,000 in case of senior citizens) are deductible under Section 80D. It is also important to note that there is no lock in and deductions can be claimed every year upon renewal, making it one of the most lucrative and flexible options. For salaried individuals, all contributions made to the Employee Provident Fund (EPF) automatically qualify for Section 80C deductions. Though EPF has a retirement oriented vision and structure, still partial withdrawals are permitted for marriage, education, home ownership and medical emergencies such as serious surgeries and procedures. Thus providing partial liquidity without breaking the investment. The repayment of home loan principal amount qualifies under Section 80C. The interest up to ₹ 2 lakhs is deductible under Section 24(b). There's no fixed lock in and deductions can be claimed yearly throughout the tenure of the home loan. It remains one of the most utilised tax saving strategies for home owners. National Pension System (NPS) provides deductions under Section 80CCD(1B) of up to ₹ 50,000 over and above the deduction provided under Section 80C. Though tier I is long term, tier II accounts offer flexible withdrawals. Do keep in mind that tier II is tax exempt only for government employees. Withdrawal of partial amounts are also permitted after three years under specific terms and conditions. Disclaimer: This article is for informational purposes only and should not be considered financial or tax advice. Please consult a qualified tax advisor or financial planner before making any investment or tax-saving decisions.
Mint
09-07-2025
- Business
- Mint
My income is irregular. How can I structure my finances and meet my money goals?
Thank you for this honest and timely question. As a woman entrepreneur with irregular income, you're not alone. The good news is, with some structure, you can turn this income irregularity into a financial strength. Start by treating yourself as both employer and employee. Fix a monthly 'salary', say ₹ 1.2 lakh, that you pay yourself from your project income. This helps regularise your expenses, SIPs and savings, while the remaining income can be reserved for bonuses, emergency padding, or short-term goals. For a long-term, tangible goal like this, you'll need both discipline and appropriate asset allocation. Create a goal-specific SIP of ₹ 25,000/month (you can stagger it). Use balanced advantage or multi-asset mutual funds for this goal to absorb market ups and downs. Don't depend entirely on equity—this is a 10-year horizon, not 25. Without EPF or employer contributions, you are your own pension plan. Open a National Pension System account for dual benefit: disciplined retirement planning and extra tax deduction under Section 80CCD(1B) ( ₹ 50,000 over and above 80C). Increase your SIPs slowly in index or flexicap equity funds earmarked for retirement. Your current ₹ 20,000 a month SIP is a good start. Over time, scale it to 30–35% of your monthly income. As an entrepreneur, insurance isn't optional, it's essential. Buy a term plan ( ₹ 1 crore+) if you haven't already—pure protection, no frills. Buy a comprehensive health policy, preferably with maternity or critical illness cover since self-employed people lack employer-provided safety nets. Max out Section 80C using ELSS mutual funds or PPF. Use NPS for an additional ₹ 50,000 deduction under 80CCD(1B). If your studio is registered, consider professional expense deductions to reduce your taxable income. Work with a CA annually to ensure you're not missing out on HRA, standard deductions, or business-linked tax breaks. You don't need a fixed salary to build wealth—you just need a fixed approach. Prioritise financial systems over perfection. With consistency and clarity, even fluctuating income can help you fund a secure, abundant life. Alpa Shah is a chartered wealth manager.
Time of India
07-07-2025
- Business
- Time of India
NPS vs UPS: Big move for central government employees! NPS tax benefits now available under UPS - here's what it means
In a significant move aimed at strengthening the Unified Pension Scheme (UPS), the Finance Ministry has extended income tax benefits currently available under the National Pension System (NPS) to the newly introduced UPS. A government release said, 'In a bid to provide further impetus to the UPS, the Government has decided that tax benefits as available under NPS shall apply mutatis mutandis to UPS as it is an option under NPS. These provisions ensure parity with the existing NPS structure and provide substantial tax relief and incentives to employees opting for the Unified Pension Scheme.' The government's decision is expected to address the primary concern that had dampened interest in the UPS — lack of clarity on tax treatment. UPS, which became operational on April 1, 2025, is a guaranteed pension model for central government employees that operates within the broader NPS framework. Tax benefits under NPS: Old vs New regimes Under the old tax regime, central government employees enjoy deductions under three provisions: Section 80CCD(1): For employee's own contribution, capped at 10% of basic salary or Rs 1.5 lakh (whichever is lower), within the broader Rs 1.5 lakh limit under Section 80C. Section 80CCD(1B): An additional deduction of Rs 50,000 for contributions to the NPS Tier-I account. Section 80CCD(2): For employer's contribution, up to 14% of basic pay + dearness allowance (DA) for central government employees. Under the new tax regime, deductions are restricted to Section 80CCD(2), where a government employee can claim up to 14% of basic pay + DA as deduction for employer's contribution. There is no deduction for the employee's contribution under this regime, according to an ET report. With the extension of the same framework to UPS, employees choosing the new scheme can expect equivalent tax savings. Key expert views on UPS tax deductions Naveen Wadhwa, Chartered Accountant and Vice President at told ET, that those choosing the old tax regime will continue to avail deductions under Section 80CCD(1) and Section 80CCD(1B). However, further clarification is required regarding the maximum deduction limit under Section 80CCD(2). The uncertainty stems from the fact that whilst Section 80CCD(2) permits a maximum deduction of 14% of basic salary plus DA under both tax regimes, the government's contribution towards UPS stands at 18.5%, which exceeds the NPS contribution rate, he said. Ashish Niraj, Chartered Accountant and Partner at A S N & Company, noted: 'One of the main reasons for the low choice of UPS was the uncertainty regarding the taxation of UPS. Now that the government has clarified that tax benefits will apply mutatis mutandis, people will get clarity. Earlier, NPS subscribers were eligible for tax deduction up to 14% of salary (Basic + DA) contributed by the employer under Section 80CCD(2) under both the tax regimes over the limit of Rs 1.50 lakh provided under Section 80C and Rs 50,000 under Section 80CCD(1B). Now, as the government contribution is 18.5% in the case of UPS, so in my view, UPS subscribers will get 18.5% deduction under 80CCD(2) if they are government employees.' Contribution structure and assured benefits under UPS As per the government's FAQs, both the employee and the Central Government will contribute 10% each of basic pay plus DA to the individual corpus. Additionally, the government will contribute another 8.5% to a pooled fund, intended to support the guaranteed pension benefits for UPS subscribers. UPS guarantees a monthly pension payout equal to 50% of the average of the last 12 months' basic pay, provided the employee has completed 25 years of qualifying service. Those with at least 10 years of service are entitled to a minimum assured payout of Rs 10,000 per month, subject to regular and timely contributions. Deadline extended for opting in The Finance Ministry has also extended the deadline for central government employees to switch from NPS to UPS from June 30, 2025, to September 30, 2025. This extension offers employees more time to assess the viability of the new scheme in light of the clarified tax treatment. This policy alignment is likely to increase traction for the UPS, especially with the potential for full tax deduction on the 18.5% employer contribution — a feature that could tilt the decision in favour of those seeking assured post-retirement benefits. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
