Sir, Greetings. I am Neeraj Gupta. Pl. guide me on selection of Old and New Tax Regime, 1. I am working with Pvt. Organization. If I choose and declare OLD Tax regime to my organization at the beggining of FY 2023-24, Can I File ITR in NEW TAX Regime later on? 2. I do book LTCG of Rs. one lakh from Mutual Fund. Is it a business Income ? Coz an tax payer can switch between old and new tax regime whenever needed if there is no income from Business.

Ans: Person earning 8.5 lacs opt for old tax regime and invest in tax saving scheme for Rs.3,50,000 than tax liability will be NIL. Further, as per Budget proposal for FY 23 24, if said person opt for new tax regime, certain deduction liks NPS will be available and on balance tax liability will be Rs 15,000 + 10% on income more than Rs 6,00,000.

Ans: For a Person not availing any tax benefits (Deduction of housing loan repayment, Life insurance premium, Mediclaim, Tax saver mutual fund etc), new tax regime will be beneficial

Ans: As per Budget proposed for FY 23-24, tax liability under old regime is likely to be Rs.97500 plus cess and under new tax regime it is likely to be Rs.82500 plus cess on total of taxable salary plus taxable rental income as 11.50 lakh

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.