In case one wishes to avail the benefits of reduced tax slab rates in place of existing tax slabs one has to forgo various tax deductions and exemptions.
The retired senior citizen will not be able to claim standard deduction in respect of pension from ex employer as well as deduction in respect of interest from post office and banks u/s 80TTB if you opt for new tax regime.
In case you have borrowed money for buying a house or for repairs of the house which is occupied by you or your parents/relatives on which no rent is received you will have to forgo the benefit of deduction for interest paid which is available upto Rs.
However looking at the tax benefits which majority of the taxpayer will have to forgo, the benefits available with existing regime will outweigh the benefits of migrating to new regime specially in case of salaried people and those who have taken home loan.
Since almost all the salaried employees will either have benefit of HRA for rent paid or they may in all probability would have bought a house with home loan.
From the above example it becomes apparent that whether one is in 20% tax slab or 30% the existing scheme is better for the one who avails all the basic deductions normally availed by persons.
50,000/- under Section 80 CCD for NPS and reduce his total income below 5 lakhs, he will not have to pay any tax by availing rebate u/s 87A upto Rs.
For those who do not have business income have to exercise the option while filing their ITR but by the due date of filing the ITR i.e.