How to decide on selecting 2021 new tax regime or old tax regime. To change language of this text click above link Old tax scheme means 2019-20 FY tax slab scheme It ends on March 31, 2020 Whether to select new tax slab or continue with old tax slab itself? We will explain in simple method with data sample from 3 persons We will explain in simple method with data sample from 3 persons Please click here>>>>>to subscribe to our chanel We use online income tax quick calculator from income-tax india govt website This can be done on any device: PC, laptop, ipad or mobile. We use online income tax quick calculator from income-tax india govt website This can be done on any device: PC, laptop, ipad or mobile. We made real time data from 3 persons to explain this This excel sheet contains the income and deductions of 3 different persons we have mapped their data mostly as per the IT statement The persons data is different in nature… First person has HRA and other exemptions, but no home loan tax deduction Now let us see the second person data Second person has other deductions as well as home loan tax deductions Third person is again different from the first 2 Third person does not have home loan as well as he has lesser deduction in all manner Now let us see whether old scheme or new scheme is better for all of these persons First let us take the first person’s data He has deductions but no home loan His total income is around 7 Lakhs as you can see He has around 2 Lakhs deduction from all sources This total salary includes all the salary income section and other incomes You can find these components from your last year IT returns as well as IT statements. The deductions includes HRA, LTA, 80C, medical insurance etc The second persons has almost same deductions as the first + home loan exemption Also his income is higher than the first person He has a total of 11.7 Lakhs from all income The break up of his income is also shown, you can make a list of your income like this According to your income and the deduction you have already The second persons break up of income is as shown above His deductions includes HRA, LTA, 80C, home loan interest etc.. The max exemption from 80C group is 1.5 Lakhs. Max exemptions from home loan interest is 2 Lakhs for self owned So the second person has almost 11.7 Lakhs of total income from various sources Deduct: 3.65 Lakh Third person has a higher income but he has lesser deductions compared to the first 2 persons Third person has salary of slab of 15 Lakhs Also he has other income from FD as 1.78 Lakhs Do not bother much about the components, but it should total your all types of incomes So this person has 16.7 Lakhs of total income He has deductions of HRA, LTA, 80C but those are less He has no home loan interest to claim for deduction His total deduction is around 38 thousand only That means his income is high and exemptions are less That means his income is high and exemptions are less Now let us see whether new tax scheme or tax scheme is better for all these 3 persons Just open a google search page in a browser In search type ‘income tax calculator india 2021’ Just scroll down and click on the ‘incometaxindiaefiling.gov.in’ link You can see this is from income tax govt of India for FY 2020-21 You can see this is from income tax govt of India for FY 2020-21 This link opens and it is a simple one ! Just make sure you have opened the correct link from income tax india govt Also make sure this is for the financial year 2020-21 This compares your income and deductions and tells you which is better for you First option is to select the Age band of the tax payer Click on select list and select your age band. You can select according to the age band and the calculation also varies accordingly I just select here as normal citizen (below 60 years) The other 2 data we need is estimated annual income as well as we need total deductions for the person The total annual income to be input in the first row The total deduction has to be put on the second row Once done, click on the ‘Compare Tax…’ button Let us pick the data of each person from the excel sheet one by one. First we will pick the first person’s data This person has a total annual income of around 7Lakhs Let us copy this total income value Let us copy this total income value Let us add this data on the first row in the calculator Let us add this data on the first row in the calculator Now let us go back to excel and pick his total deductions Copy the total deduction value from excel sheet It is around 2Lakhs for him Now add this data to the second row of the calculator Just added the same value Click on the ‘compare tax…’ button His tax calculations as per old and new schemes are shown here As per old tax scheme he has to pay 13 thousand and change As per new tax scheme he has to pay 33 thousand plus That is for him old tax scheme is better He has benefit of 20 thousand as per old scheme So for him, he can continue with old scheme twenty thousand and change so let this
person does not migrate to the new one latest tax scheme of twenty twenty-one
financially now let us take the other Now let us take the second persons data who has home loan deductions as well as the other His total income is around 11.7 Lakhs He has around 3.6 Lakhs deductions Let us copy data from here and enter in the excel sheet of total income Also copy total deduction 36k And put it in the online calc click on ‘compare tax’ The total tax payable is shown as per old and new regime. It says this persons benefits around 36920 from old scheme That means this person also benefits from old scheme Now let us do the same with third person He has very less deductions compared to the other two Total income for this person is 16 Lakhs and total deduction is around 38 thousand Just copy the total data of both income and deductions Again, this person has very less deductions Copy the total income and put it in the online calculator Copy the total income and put it in the online calculator Now copy the total deductions from excel sheet and put it in the excel sheet And click on the ‘compare tax…’ This says ‘New Regime’ is better for this person By new scheme he has benefit of 65 thousand That means if you have already lesser deductions, new scheme is better Same way pull your data from your tax statement and other income Also pull your data from all the deductions and exemptions you have In this case first 2 persons already had many exemptions and OLD scheme is better for them For third person he has lesser deductions and so the NEW scheme is better for him For third person he has lesser deductions and so the NEW scheme is better for him Please subscribe to our channel by clicking here>>>>Thank you for watching the video… Please give us a LIKE if you liked this video See you later with another video.