Question 1

What is the difference between Old and New Tax Regime?

Accepted Answer

The Old Regime allows you to claim deductions like 80C, 80D, HRA, etc., which reduces your taxable income but has higher tax rates. The New Regime offers lower tax rates and a higher standard deduction (₹75k) but does not allow most Chapter VI-A deductions.

Question 2

Which regime is better?

Accepted Answer

It depends on your deductions. If you have significant investments (like EPF, ELSS, Insurance) and pay home loan interest or HRA, the Old Regime might save you more. For those with fewer deductions, the New Regime is generally better.

Question 3

What is the 87A rebate?

Accepted Answer

Under Section 87A, if your taxable income is below a certain threshold, the government gives you a tax rebate. In the New Regime, it makes income up to ₹12.75L effectively tax-free. In the Old Regime, it applies up to ₹5L.

Income Tax Calculator India: Old vs New Regime

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