What should a Senior Citizen pensioner with a pension of Rs 20 Lakh choose, old regime or new regime of Income Tax ?
Ans: New tax regime is beneficial if all the tax benefits are not taken. For e.g. if income is 20 lacs and deductions u/s 80C is 150000 taken, tax liability will be Rs.300000 under new tax regime and under old it will be 367500.
However, if person take PPF benefit of 1.5 lac, 25k in mediclaim, housing loan interest deduction 2 lacs, 50k standard deduction from salary; tax liability under old regime will reduce to 285000.
(plus applicable cess)