Income Tax Calculator 2024-2025

Individual taxpayers are currently facing confusion regarding the choice between the old and new tax regimes, which were introduced in the Union Budget 2023. While the new regime offers lower slab rates, it requires taxpayers to forego most of the deductions and exemptions available under the old regime. Therefore, in order to make an informed decision, taxpayers must carefully examine both the existing and new tax regimes. To estimate their income tax payable under each regime, they can utilize the new income tax calculator for FY 2024-25, which is user-friendly and can provide results in just a few simple steps.

Disclaimer: This income tax calculator provides estimates only and is for informational purposes. The calculations and results are estimates based on the data entered by the user and are not guaranteed to be accurate. For accurate tax advice, consult a qualified tax professional.

How to Use Income Tax Calculator online for FY 2024-25 ?

To use the online income tax calculator, follow these steps:

1. Go to BusinessLine's website and access the income tax calculator.
2. Choose the financial year you want to calculate taxes for (2023-24, 2024-25) and select your age range (regular individual, senior citizen, or super senior citizen), then click "Next."
3. Enter your gross income from various sources (salary, interest, rental, other) and click "Next."
4. Input your tax-saving investment details, such as deductions under Section 80C, HRA, medical insurance, NPS, and others, then click "Next" to proceed.
5. Once all information is entered, the calculator will compute your taxes under both the old and new tax regimes.
6. If you haven't reached the maximum limit for Section 80C deductions (Rs. 1.5 lakh), you can save taxes under that section by clicking the "View Plans" button

Tax Brackets and Rates

In India, there are currently two Income Tax regimes, allowing individuals to choose between paying taxes under the new or old regime. The new regime offers lower tax rates for higher income groups. It's important to note that tax slab rates vary based on age, income group, and the chosen tax regime. To determine your tax liabilities, you can use an income tax calculator and consider all of these details. The new income tax slab rates differ from those of the old regime in the following ways:

Note:The slabs and rates of tax in the 'Proposed New Tax Regime Slab Rate' column apply to taxpayers of all ages.

The new income tax slab rates result in lower taxes for individuals with net taxable income ranging from Rs. 5 lakhs to Rs. 15 lakhs, which can reduce their tax burden.Income tax rates applicable for individuals aged between 60 and 80 years who are senior citizens.

Senior citizens: Individuals aged between 60 and 80 years

Under the old tax regime, senior citizens are given a higher exemption limit of Rs. 3 lakh compared to the Rs. 2.5 lakh limit offered under the new tax regime. For super senior citizens above 80 years, the old tax regime offers a higher exemption limit of up to Rs. 5 lakh, while the new tax regime offers a flat income tax exemption limit of Rs. 2.5 lakh regardless of the age of the taxpayer.

Super Seniors: Senior citizens above 80 years

How is income tax calculated?

To calculate income tax as per the old income tax slab, you need to follow a few steps. Firstly, calculate your gross taxable income by subtracting your deductions such as HRA, LTA, and standard deduction from your gross salary and adding income from other sources. Secondly, calculate your total tax benefits by investing in tax-saving options such as ELSS and PPF available under section 80C of the Indian Income Tax. Thirdly, calculate your net taxable income by subtracting the total tax benefits from the gross taxable income. Lastly, calculate your total tax liability based on the tax rate applicable to your total taxable income. If your total taxable income is less than ₹5 lakhs, you will get a rebate of ₹12,500 under section 87A. For the new tax regime, deductions/exemptions such as HRA and LTA would be taxable, and you cannot avail tax benefits by investing in tax-saving instruments and other deductions.

Income Tax Calculator FAQs

Salary tax is calculated using your total taxable income after all deductions and exemptions, your income tax slab, and the tax regime you have chosen.

Exemptions are portions of your income that are exempt from taxation. Exemptions include, for example, a portion of your LTA (Leave Travel Allowance). Deductions, on the other hand, are expenses that aid in the reduction of taxable income. For example, you can claim your ELSS, NPS, and PPF investments as Section 80C deductions to reduce your net taxable income.

All deductions under Chapter VIA, such as 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80G, 80GG, 80GGA, 80GGC, are no longer available to taxpayers under the new tax regime. Furthermore, the deduction for interest on housing loans under section 24 as well as the deduction for family pension income are no longer available under the new tax regime.

A statutory deduction of Rs.75,000 and exemption from allowances such as HRA and LTA are not permitted for salaried individuals.

The basic salary + HRA + Special Allowance + Transport Allowance + any other allowances make up the salary income. Some salary components, such as phone bill reimbursement, leave travel allowance, and so on, are tax-free. You can claim an HRA exemption if you rented a place and received HRA.

Aside from these deductions, the budget 2018 introduced a standard deduction of Rs 40,000, which was later increased to Rs 50,000 in the budget 2019.

The following information is necessary throughout the e-filling process:

1. PAN number, Adhar number, and address are examples of basic information.
2. Income details from multiple sources, such as salary, residential property, or any other source.
3. Evidence of payment of any advance tax or TDS (tax deducted at source) data
4. Bank information kept in the fiscal year
5. Details of Chapter VIA deductions to be claimed
6. Learn more about ITR e-filing by clicking here.