The tax regime defines the tax slabs and rates. In 2020 the government introduced a new tax regime with higher tax rates but more options for tax savings. The new tax regime also gives taxpayers the option to select either old or new regimes making taxation all the more complicated. While figuring out what option to go for might look complicated, if you approach it systematically, it is not that difficult to figure out.
- Calculate all the exemptions available
- Check out the deductions that you can claim
Accordingly, different taxpayers will benefit differently under the 2 tax regimes. One thing that taxpayers need to be careful of is tax regimes should not take precedence over life goals. For instance, it is you who should decide whether to invest your money or to go for insurance depending on your needs.