MY ANNUAL CTC 25.0 LAKHS MY INVESTMENT AND PPF MORE THAN 2.5LACS WHICH TAX REGIME WHICH IS SUITABLE FOR ME.

Ans: Based on the information you have provided, you can calculate your tax liability under both the old tax regime and the new tax regime to see which one is more beneficial for you.

Under the old tax regime, you can claim deductions under Section 80C for your home loan principal repayment, ELSS, life insurance premium, tuition fees, and PPF, which amounts to a total deduction of up to INR 1.5 lakh. In addition, you can claim a deduction of up to INR 25,000 for medical insurance premium under Section 80D. Your total deductions would be INR 1.75 lakh, which reduces your taxable income to INR 10.25 lakh.

Your tax liability under the old tax regime would be as follows:

Up to INR 2.5 lakh: Nil
INR 2.5 lakh to INR 5 lakh: 5% of (taxable income - INR 2.5 lakh)
INR 5 lakh to INR 7.5 lakh: INR 12,500 + 10% of (taxable income - INR 5 lakh)
INR 7.5 lakh to INR 10 lakh: INR 37,500 + 15% of (taxable income - INR 7.5 lakh)
INR 10 lakh to INR 12.5 lakh: INR 75,000 + 20% of (taxable income - INR 10 lakh)
Above INR 12.5 lakh: INR 1,25,000 + 30% of (taxable income - INR 12.5 lakh)
Under the new tax regime, you cannot claim the deductions under Section 80C, Section 80D, and other sections. However, you can claim a standard deduction of INR 50,000. Your taxable income would be INR 11.1 lakh.

Your tax liability under the new tax regime would be as follows:

Up to INR 2.5 lakh: Nil
INR 2.5 lakh to INR 5 lakh: 5% of (taxable income - INR 2.5 lakh)
INR 5 lakh to INR 7.5 lakh: INR 12,500 + 10% of (taxable income - INR 5 lakh)
INR 7.5 lakh to INR 10 lakh: INR 37,500 + 15% of (taxable income - INR 7.5 lakh)
INR 10 lakh to INR 12.5 lakh: INR 75,000 + 20% of (taxable income - INR 10 lakh)
Above INR 12.5 lakh: INR 1,25,000 + 30% of (taxable income - INR 12.5 lakh)
Based on the above calculations, it seems like the old tax regime may be more beneficial for you as your taxable income would be lower due to the deductions under Section 80C and Section 80D. However, you should consult a tax expert or a financial advisor to make an informed decision based on your individual circumstances.

Ans: New scheme is likely to beneficial for FY 2023-24.

You can compare the tax liability under both regime at https://incometaxindia.gov.in/Pages/tools/115bac-tax-calculator-finance-bill-2023.aspx

Ans: Person should select tax regime based on eligible amount of deductions/exemptions under both tax regime. Usually when person is eligible for maximum of specified limit old tax regime is beneficial.

For e.g. if person is earning income from salary of Rs.15 lacs, eligible for deduction of Rs.1 lakh (say from HRA) and eligible for deduction for tax saver investment of Rs.1 lakh (say from LIC, PPF, Tax saver MF, Mediclaim etc). New tax regime is likely to reduce tax liability for FY 23-24.

However, if we change example and increase deduction from salary to Rs.1.5 lacs and deduction of tax saver investment to Rs.2.5 lacs, old tax regime is likely to beneficial for FY 2023-24.

You can compare tax liability at https://incometaxindia.gov.in/Pages/tools/115bac-tax-calculator-finance-bill-2023.aspx

Ans: Selection of tax regime depends of eligibility of amount of deduction and exemption. Considering income of 40lacs, when amount of deductions/exemption cross 7,75,000; old scheme is likely to be beneficial for the tax payer.

You can calculate tax liability, using advance income tax calculator available at following link:

https://eportal.incometax.gov.in/iec/foservices/#/TaxCalc/calculator