Taxes are one of your largest recurring annual outflows. Understanding basic tax rules and tax deductions allows you to legitimately retain more of your hard-earned income.
New vs. Old Tax Regime
The New Tax Regime features lower tax slab rates with a โน75,000 standard deduction and minimal paperwork. The Old Regime is preferable if your total eligible deductions (80C, 80D, HRA, Home Loan Interest) exceed โน3,75,000.
Key Deductions Under Old Regime
- Section 80C: Up to โน1.5 Lakhs across EPF, PPF, ELSS Tax-Saver Funds, and Life Insurance.
- Section 80D: Up to โน25,000 (โน50,000 for senior citizens) for family medical insurance premiums.
- Section 80CCD(1B): Additional โน50,000 exclusive deduction for voluntary National Pension System (NPS) deposits.
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