Calculator for Income Taxes for the Financial Year 2023–24 (AY 2024–25)
Making the New Income-Tax regime the default choice for all salaried taxpayers, with the option to choose the Old Tax Regime, is one of the significant changes included in the Finance Bill 2023. In other words, the State wants to tell the taxpayers to “Give to Caesar the things that are Caesar’s and to God the things that are God’s.” The change is a sign that the government intends to end the convoluted taxation process with exemptions and deductions in favour of a simple tax calculation with lower tax rates. (Mark 12:17).
Since the government is obligated to utilise the money we pay in taxes to carry out different national development initiatives through welfare programmes, such as funding for public infrastructure, expansion and welfare projects, and job programmes. As a result, it is everyone’s duty to pay their fair share of taxes to the government since doing so will help each person develop. According to Aristotle, “When the society or organisation expands, all those connected to it also grow equally. However, if individuals are growing faster than the society or organisation, the entire structure of the State or Society may fail. Do as you would have done, as the Golden Rule mosaic instructs, and everyone is required to abide by this maxim in order to receive the rewards they deserve. Pay your taxes on time in order to support the progress of the State and Society, which will benefit the entire country.
Tax savings are permissible, however tax evasion using tax saving alternatives’ loopholes has to be examined in light of the Bible verse that reads, “All things are permissible, but not all things are advantageous.” Though everything is legal, not everything contributes to growth. (1 Cor 10:23)
For the financial year 2023–24 (AY 24–25), this article includes an automatic income tax calculator in Excel format. For paid workers in the public and commercial sectors, the income tax calculator is useful.
With the hope that our tax calculator may assist you, we wish you a prosperous new year!
The significant changes impacting how salaried employees are taxed are listed below. They should carefully evaluate these changes and make tax planning decisions.
It is suggested that the new tax system established by Section 115BAC act as the default system.
Employees who choose the New Tax Regime are eligible for both the standard deduction from salary income and the family pension.
The revised basic exemption ceiling will be INR 3,00,000, and the following slab rate would apply for every additional INR 3,00,000 of income. Income beyond INR 15,00,000 will continue to be subject to the highest slab rate of 30%.
For taxpayers choosing the new tax system, the total income entitled for a rebate under Section 87A has increased from INR 5,00,000 to INR 7,00,000.
The maximum surcharge rate, which was formerly 37% on income beyond INR 5,00,00,000, has been lowered to 25% under the new tax system. Under the Old Regime, surcharge rates stay the same.
INCOME TAX SLABS
| New Regime | |
| Income Range | Income tax rates |
| Upto RS 3 lakh. | Nil |
| Rs 3 to 6 Lakh. | 5% on income exceeds Rs. 3,00,000 |
| Rs 6 to 9 Lakh. | Rs. 15,000 + 10% on income exceeds Rs. 6,00,000 |
| Rs 9 to 12 Lakh. | Rs. 45,000 + 15% on income exceeds Rs. 9,00,000 |
| Rs 12 to 15 Lakh. | Rs. 90,000 + 20% on income exceeds Rs. 12,00,000 |
| Above 15 Lakh. | Rs. 150,000 + 30% on income exceeds Rs. 15,00,000 |
| Old Regime | |
| Income Range | Income tax rates |
| Upto RS 2.5 lakh. | Nil |
| Rs. 2.5 to 5 Lakh. | 5% on income exceeds Rs. 2.5 Lakh |
| Rs. 5 to 10 Lakh. | Rs.12,500+ 20% on income exceeds Rs.5 Lakh |
| Above Rs. 10 Lakh. | Rs.1,12,500+ 30% on income exceeds Rs.10 Lakh |
Below is a comparison of the deductions and exemptions offered by the new and previous tax systems. Depending on what investments and payments have been made or are applicable to them, one can determine whether to choose the Old Regime or the New Regime.
| Particular | Old Tax Regime | New Tax Regime |
| Income level for rebate eligibility | 5 Lakh. | 7 Lakh. |
| Standard Deduction | Rs. 50,000. | Rs. 50,000. |
| Effective tax-free salary income | Rs 5.5 Lakh | Rs. 7.5 Lakh. |
| Rebate u/s 87A (Max amount) | 12,500 | 25,000 |
| Allowable exemption | ||
| HRA Exemption | ✓ | X |
| Leave travel allowance | ✓ | X |
| Food Allowance | ✓ | X |
| Exemption on voluntary retirement 10 (10C) | ✓ | ✓ |
| Exemption on Grattuity 10(10C) | ✓ | ✓ |
| Exemption on leave encashment u/s 10(10AA) | ✓ | ✓ |
| Transport allowance for a specially abled person | ✓ | ✓ |
| Other deduction | ||
| Professional tax | ✓ | X |
| Intrest on home loan u/s 24b on self-occupied or vacant property | ✓ | X |
| Intrest on home loan u/s 24b on let-out property | ✓ | ✓ |
| Deduction under chapter 4-A | ||
| Deduction u/s 80C | ✓ | X |
| NPS self contribution u/s 80CCD(1B) | ✓ | X |
| NPS self contribution u/s 80CCD (2) | ✓ | ✓ |
| Medical insurance premium -80D | ✓ | X |
| Intrest on education loan-80E | ✓ | X |
| Intrest on electric vehicle loan 80EEB | ✓ | X |
| Donation to political party/trust etc-80G | ✓ | X |
| Saving bank intrest u/s 80TTA and 80TTB | ✓ | X |
| Disable individual-80U | ✓ | X |
If your income is less than Rs 7.5 lakh, you should choose the new tax system because there is no tax deduction for people with incomes up to that amount.
if you have made no tax-saving purchases or investments.
If the maximum deduction under 80C is merely Rs. 1.5 lakh, choose the new tax system. The new tax system would be more advantageous for someone who has only taken a deduction of Rs 1.5 lakh under section 80C.
When should one choose the Old Regime?
Choose the old tax system if you are paying housing loan interest, rent, or additional tax-saving expenses like medical insurance, NPS contributions, and other chapter VI-A deductions in addition to the 80C deductions.
The break-even point for the old and new tax regimes is reached when gross income is 16 lakh and one has deductions totaling 4.25 lakh (Section 80C-1.5 lakh, interest on a housing loan of Rs. 2.0 lakh, medical insurance of Rs. 25,000, and standard deduction of Rs. 50,000). The tax burden under the previous tax system will be lower when there are more allowable deductions.
I hope the information above will be useful to you as you prepare your tax strategies.
