Old vs New Tax Regime: Key Benefits in the Income Tax Bill 2025

Income Tax Bill 2025 introduces a simplified tax structure, replacing Section 115BAC with Section 202, effective from April 1, 2026

Revised Tax Slabs

– Up to ₹4,00,000 – No tax – ₹4,00,001 - ₹8,00,000 – 5% – ₹8,00,001 - ₹12,00,000 – 10% – ₹12,00,001 - ₹16,00,000 – 15% – ₹16,00,001 - ₹20,00,000 – 20% – ₹20,00,001 - ₹24,00,000 – 25% – Above ₹24,00,000 – 30%

Tax Exemptions in the New Regime

– ₹60,000 exemption for incomes up to ₹12 lakh – No tax payable for eligible taxpayers within this limit

Rebate in the Old Regime

– ₹12,500 rebate under Section 156 – Applicable for incomes up to ₹5 lakh

                                          

Key Benefits of the New Regime

✅ Lower tax rates for middle-income earners ✅ Simplified filing process ✅ No need for multiple deductions & exemptions

Old vs. New – Choosing the Right One

– Old Regime: Best for those benefiting from deductions (HRA, 80C, 80D, etc.) – New Regime: Ideal for those preferring a straightforward tax structure

The new tax bill aims to enhance transparency and ease tax compliance. Taxpayers should assess their finances and choose wisely!