Old vs New Tax Regime for FY 2024-25: Complete Guide with Slabs and Deductions

The Budget 2024 introduced meaningful revisions to the New Tax Regime, making it even more attractive for salaried employees and professionals. ### Key Changes in the New Tax Regime for FY 2024-25 (AY 2025-26): 1. **Enhanced Standard Deduction**: The standard deduction for salaried individuals under the new tax regime has been raised from ₹50,000 to ₹75,000. 2. **Revised Tax Slabs**: - Up to ₹3,00,000: Nil - ₹3,00,001 to ₹7,00,000: 5% - ₹7,00,001 to ₹10,00,000: 10% - ₹10,00,001 to ₹12,00,000: 15% - ₹12,00,001 to ₹15,00,000: 20% - Above ₹15,00,000: 30% 3. **Section 87A Rebate**: Resident individuals with taxable income up to ₹7,00,000 pay zero tax due to the rebate under Section 87A (up to ₹25,000). Combined with the ₹75,000 standard deduction, a salaried employee with gross income up to ₹7.75 Lakh pays zero income tax! ### When is the Old Regime Still Better? The Old Regime remains beneficial primarily for taxpayers who claim high cumulative deductions exceeding ₹3.75 Lakh to ₹4.25 Lakh, including: - Section 80C investments (up to ₹1,50,000) - Section 80D health insurance premiums (up to ₹25,000 - ₹50,000) - Section 24(b) home loan interest (up to ₹2,00,000) - Significant HRA exemptions under Section 10(13A).