Tax Calculator for Resident Individuals FY 2020-21

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In this budget, a new tax regime was introduced. The tax rates in this regime are low, but taxpayers will have to forgo most exemptions and deductions. However, people can choose the old regime if they don’t want to forgo the exemptions and deductions.

If you want to know more about the tax rates in both the regimes, then read this article.

The finance minister, Nirmala Sitharaman, introduced a new tax regime in the Budget 2020. The tax rates in the new regime are lower compared to the old regime. However, taxpayers who opt for the new regime will have to forgo most exemptions and deductions. If people want to claim deductions and exemptions, they can opt for the old tax regime. Thus, taxpayers need to understand if their deductions and exemptions can help them reduce their tax amount.

The taxpayers are allowed to choose between both regimes. Hence, a person can pick a regime that helps him/her lower his/her tax liability.

New Tax Regime

Annual Income Tax Rate
Below Rs. 2.5 Lakhs 0
Between Rs. 2.5 Lakhs and Rs. 5 Lakhs 5%
Between Rs. 5 Lakhs and Rs. 7.5 Lakhs 10%
Between Rs. 7.5 Lakhs and Rs. 10 Lakhs 15%
Between Rs. 10 Lakhs and Rs. 12.5 Lakhs 20%
Between Rs. 12.5 Lakhs and Rs. 15 Lakhs 25%
Above Rs. 15 Lakhs 30%

Old Tax Regime

For Individuals Below 60 Years of Age

Annual Income Tax Rate
Below Rs. 2.5 Lakhs 0
Between Rs. 2.5 Lakhs and Rs. 5 Lakhs 5%
Between Rs. 5 Lakhs and Rs. 7.5 Lakhs 20%
Between Rs. 7.5 Lakhs and Rs. 10 Lakhs 20%
Between Rs. 10 Lakhs and Rs. 12.5 Lakhs 30%
Between Rs. 12.5 Lakhs and Rs. 15 Lakhs 30%
Above Rs. 15 Lakhs 30%

For Individuals Between 60 and 80 Years of Age

Annual Income Tax Rate
Below Rs. 3 Lakhs 0
Between Rs. 3 Lakhs and Rs.5 Lakhs 5%
Between Rs. 5 Lakhs and Rs. 10 Lakhs 20%
Above Rs. 10 Lakhs 30%

For Individuals Above 80 Years of Age

Annual Income Tax Rate
Below Rs. 5 Lakhs 0
Between Rs. 5 Lakhs and Rs. 10 Lakhs 20%
Above Rs. 10 Lakhs 30%

If a senior citizen wants to opt for the new regime, then he/she can’t avail a higher exemption limit. In the new regime, the exemption limit doesn’t change for any age group.

In order to calculate your tax amount, you can use a tax calculator. To use this calculator, you’ll need to enter details, such as your income, exemptions, deductions, etc. The calculator will calculate the tax amount based on your details.

How to Choose a Tax Regime

Before choosing a tax regime, a taxpayer needs to calculate his/her tax amount under both the regimes. He/she can use a tax calculator to find out the tax amount easily. A taxpayer can opt for the old regime in case he/she doesn’t want to forgo the exemptions and deductions. However, if a person can forgo the exemptions and deductions, then he/she should choose the new regime.