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This Income Tax Calculator FY 2023-24 AY 2024-2025, facilitates the online computation as well as Income Tax Calculator excel download ( free ), of income tax for both the new Financial Year 2024-25 and the previous Financial Year 2023-24 (Assessment Year 2024-25), utilizing both the Old and New Tax Regimes. Additionally, it serves as a dedicated calculator for the New Tax Regime.
Furthermore, it will help you understand your answer for “Which Tax Regime New or Old?” — enabling you to minimize your income tax liability based on your earnings and investments. Take the calculation with a pinch of salt, as this is going to be an approximate amount of tax liability, for more minute details ask your financial advisor or get help from your CA to get into nitty-gritties of the overall tax liability for you.
If, you just want to estimate your income tax, and compare old regime vs new regime ( old tax regime vs new tax regime )
What is Income Tax Calculator?
An income tax calculator in India is an online tool designed to assist individuals in estimating their tax liability for a given financial year. This tool takes into account the specific rules and slabs of the Indian Income Tax Act, which are updated annually. Users input details such as their total income from various sources (salary, house property, capital gains, business/profession, and other sources), deductions under sections 80C to 80U, and exemptions they are eligible for.
The calculator is tailored to accommodate the dual tax regime introduced in the Union Budget 2020 – the Old (existing) and New (optional) tax regimes. The Old regime allows for a higher number of deductions and exemptions, while the New regime offers lower tax rates with fewer deductions. The income tax calculator helps individuals compare their tax liabilities under both regimes, enabling them to make an informed decision on which regime to opt for based on their income composition and potential tax savings.
It simplifies the complex process of tax calculation, making it easier for taxpayers to comply with their tax obligations and plan their finances effectively, especially in terms of making tax-saving investments.
Income Tax Calculator
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Income Tax Calculator Excel FY 2023 24 | Income Tax Calculator Excel AY 2023 24 | Download Free
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Indian Income Tax Basics
Indian goverment had 2 regimes based on which the income tax is levied on individuals. Most famously termed as Old Regime ( Old Tax Regime ) vs New Regime ( New Tax Regime ). In this blog, we will get into basics of each of these regimes, and, also you will have your answer for Old Regime is better or New Regime ?
Old Tax Regime ( Old Regime )
The Old Tax Regime in India, prior to the introduction of the New Tax Regime in 2020, is characterized by its structure of allowing various deductions and exemptions to taxpayers. Here are the key features of the Old Tax Regime:
- Tax Slabs: The Old Tax Regime has defined tax slabs based on the income levels of individuals, with progressively higher rates for higher income brackets.
- Deductions and Exemptions: One of the most notable features of the Old Tax Regime is the wide range of deductions and exemptions available under various sections of the Income Tax Act, such as:
- Section 80C: Investments in PPF, NSC, ELSS, life insurance premiums, tuition fees, etc., up to a limit of ₹1.5 lakh per annum.
- Section 80D: Deduction for medical insurance premiums for self and family.
- Section 80E: Interest on education loan.
- House Rent Allowance (HRA), Leave Travel Allowance (LTA), and standard deduction for salaried employees.
- Deductions for home loan interest under Section 24.
- Suitability: The Old Tax Regime is generally more beneficial for individuals who have significant investments, expenses that qualify for deductions, or those who can make use of various exemptions to reduce their taxable income.
- Flexibility in Planning: It offers flexibility in tax planning allowing individuals to make investments or expenditures that can lower their taxable income.
- Opting Out: Under the dual tax regime system, taxpayers have the option to choose between the Old and New Tax Regimes each financial year based on which is more advantageous to them.
The Old Tax Regime’s structure incentivizes savings and investments through its provisions for deductions and exemptions, making it a preferred choice for many taxpayers, especially those with higher expenditures that qualify for these benefits.
Old Regime Tax slabs For Individual upto 60 years of Age:
| Tax Slab (₹) | Old Tax Rates for Citizens (Aged less than 60 Years) |
| 0 – 2.5 lakh | 0% |
| 2.5 lakh – 5 lakh | 5% |
| 5 lakh – 10 lakh | 20% |
| 10 lakh & above | 30% |
Old Regime Tax slabs For Individual > 60 years of age and < 80 years
| Tax Slab (₹) | Old Tax Rates for Senior Citizens (Aged 60 Years And < 80 ) |
| 0 – 3 lakh | 0% |
| 3 lakh – 5 lakh | 5% |
| 5 lakh – 10 lakh | 20% |
| 10 lakh and above | 30% |
Old Regime Tax slabs For Individual > 60 years of age and < 80 years
| Tax Slab (₹) | Old Tax Rates for Super Senior Citizens (Aged 80 Years And Above) |
|---|---|
| Rs 0 – Rs 5 lakh | 0% |
| Rs 5 lakh – Rs 10 lakh | 20% |
| Rs 10 lakh and above | 30% |
New Tax Regime ( New Regime )
The New Tax Regime, introduced in the 2020 Union Budget in India, presents an alternative to the Old Tax Regime, offering lower tax rates but with fewer deductions and exemptions. Here are the key aspects of the New Tax Regime:
- Lower Tax Rates: The New Tax Regime offers more favorable tax rates across various income slabs, aimed at reducing the tax liability for individuals. However, to avail of these lower rates, taxpayers have to forego most of the deductions and exemptions available under the Old Tax Regime.
- Simplified Structure: By eliminating most deductions and exemptions, the New Tax Regime aims to simplify the income tax process, making it easier for taxpayers to file their returns without having to navigate through numerous deductions and exemptions.
- No Major Deductions and Exemptions: Taxpayers opting for the New Tax Regime cannot claim major deductions such as those under Section 80C for investments, Section 80D for medical insurance, HRA, and LTA, among others.
- Optional Choice: Taxpayers have the flexibility to choose between the Old and New Tax Regimes each financial year based on what benefits them the most. This choice allows taxpayers to opt for the regime that results in lower tax liability.
- Designed for Simplification: The New Tax Regime is designed to appeal to those with fewer investments or those who do not make use of many deductions and exemptions. It is particularly aimed at simplifying tax filing for young professionals and those who prefer a straightforward tax calculation without the need for tax planning.
- Impact on Tax Planning: The introduction of the New Tax Regime impacts tax planning strategies, as individuals might need to reassess their investment decisions based on the regime they choose.
The New Tax Regime is part of the government’s effort to make the tax system more straightforward and less cumbersome for taxpayers, especially for those who may not have significant investments or expenses that qualify for deductions under the Old Regime.
New Regime Tax slabs till FY 2023-2024, AY 2024-2025
| Income Slabs | Income Tax Rates |
| ₹0 – ₹2,50,000 | – |
| ₹2,50,000 – ₹5,00,000 | 5% (tax rebate u/s 87A is available) |
| ₹5,00,000 – ₹7,50,000 | 10% |
| ₹7,50,000 – ₹10,00,000 | 15% |
| ₹10,00,000 – ₹12,50,000 | 20% |
| ₹12,50,000 – ₹15,00,000 | 25% |
| >₹15,00,000 | 30% |
Why one should pay tax?
In India, income tax is levied by the government on individuals, businesses, and other entities based on their income or profit. The reasons for paying income tax include:
- Revenue for Government: Income tax is a major source of revenue for the government. This revenue is utilized to fund public services such as education, healthcare, infrastructure development, defense, and welfare programs.
- Redistribution of Wealth: Through progressive taxation, where higher income brackets are taxed at higher rates, income tax helps in the redistribution of wealth, aiming to reduce economic inequality.
- Nation Building: The funds collected through income tax are essential for nation-building activities and developmental projects that benefit the country as a whole.
- Legal Obligation: Paying income tax is a legal requirement for individuals and entities earning above a certain threshold. Non-compliance can lead to penalties and legal actions.
- Social Responsibility: Contributing to national development through income tax is a form of social responsibility, supporting the government in providing essential services to all citizens, including those who are economically disadvantaged.
Thus, paying income tax in India is both a statutory obligation and a crucial contribution towards the country’s growth and development.
Differences between Old Tax Regime and New Tax Regime
| Aspect | Old Tax Regime | New Tax Regime |
|---|---|---|
| Tax Rates and Slabs | Higher tax rates with a wider range of slabs, beneficial with deductions. | Lower tax rates across fewer slabs, simplified calculation. |
| Deductions and Exemptions | Allows broad deductions and exemptions, reducing taxable income. | Eliminates most deductions and exemptions, simplifying tax process. |
| Flexibility for Tax Planning | Offers significant opportunities for tax planning through eligible investments. | Less flexibility for tax planning, benefits those preferring simplicity. |
| Target Audience | Suitable for individuals with high investments and deductible expenses. | Suited for those with minimal investments or seeking simplicity. |
| Choice and Flexibility | Customizable approach based on individual financial decisions. | Hassle-free tax calculation with less need for detailed planning. |
Exemption and Tax Deductions in Old Tax Regime
| Exemptions | Tax Deductions |
|---|---|
| House Rent Allowance (HRA) | Section 80C investments (PPF, NSC, ELSS, life insurance, tuition fees, etc.) up to ₹1.5 lakh |
| Leave Travel Allowance (LTA) | Section 80D medical insurance |
| Standard Deduction for salaried employees | Section 80E education loan interest |
| Transport Allowance | Home loan interest under Section 24 |
| Medical Allowance | Section 80G donations to charitable institutions |
| Education Allowance | Section 80GG rent paid for those not receiving HRA |
| Hostel Expenditure Allowance | Section 80TTA interest on savings accounts |
| Children Education Allowance | Section 80CCD(1B) investment in NPS |
| Daily Allowance | Section 80DDB treatment of specified diseases |
| Helper Allowance | Section 80U deduction for persons with disability |
Old regime vs New Regime ??
Every salaried invidual has this question in mind, which income tax regime is best for me?? This question is mostly dependent on 2 major things:
- What’s you salary and thus tax-bracket or tax-slab range??
- And, what are your investments in the tax-saving instruments allowed by the government?
The following table give you basic answer, and we will take 2 scenarios, one with no-investment and other one with fully-exhausting your tax-saving options ( 80C and 80CCD(1B) ).
In case of “When you’ve used all options under the limit“, these are the assumptions made:
- Let’s say gross salary is 100 and you live in a Non-Metro.
- Base is 60, DA is 10, HRA is 30 .
- Rent paid is 20
- Tax saving investments, 80C ( 1.5 Lakhs ) and 80CCD(1B) NPS contribution limited to 50K .
For your specific case you can use our income tax calculator online or use our income tax calculator excel by downloading it free of cost.
| Which is best for me old regime or new regime | When you have no investments | When you’ve used all options under the limit |
| which tax regime is better for 5 lakhs | New Regime | New Regime |
| which tax regime is better for 10 lakhs | New Regime | Old Regime |
| which tax regime is better for 15 lakhs | New Regime | Old Regime |
| which tax regime is better for 20 lakhs | New Regime | Old Regime |
| which tax regime is better for 25 lakhs | New Regime | Old Regime |
| which tax regime is better for 30 lakhs and above | New Regime | Old Regime |
The below table, gives you a hint on “What is income tax on 20 lakhs salary??” types of questions, again there are a few assusmptions, In old regime you’ve exhausted all deductions and exemption options for tax-saving purposes. For calculating Income tax for your specific case, use our income tax calculator online or use income tax calculator excel by downloading it for free.
| Tax on income | Old Regime all investments done | New Regime |
| income tax on 5 lakhs salary | 0 | 0 |
| income tax on 10 lakhs salary | ~15K | ~46K |
| income tax on 15 lakhs salary | ~94K | ~1.3 Lakhs |
| income tax on 20 lakhs salary | ~ 2 Lakhs | ~ 2.8 Lakhs |
Frequently Asked Questions
How do I use Excel to calculate income tax FY 2023 24 ?
You can enter the required details, such as Basic Income, DA, HRA, Investments, Other Incomes etc. And the excel will output the tax liability from both Old Regime and New Regime, this will also help you choose what works for you the best Old Regime or New Regime.
How to calculate income tax?
You can use our income tax calculator online tool or you can download following excel to help you estimate your income tax liability
What is the formula for calculating ITR in Excel?
There is no fixed formula to calculate Income tax ( not ITR ) in excel, but you can use the above mentioned income tax caculator excel to get an estimate of your income tax liability
What are income tax slabs?
Income tax slabs in India define ranges of income taxed at specific rates, updated annually. They ensure a progressive tax system, with different slabs for various taxpayer categories, including individuals, senior citizens, and companies. The introduction of the new tax regime offers an alternative with lower rates but fewer deductions.
Old Regime:
Individuals (below 60 years) and HUFs: Tax-exempt for income up to ₹2.5 lakh, 5% for ₹2.5 lakh to ₹5 lakh, 20% for ₹5 lakh to ₹10 lakh, and 30% for above ₹10 lakh.
Senior Citizens (aged 60 years but below 80 years): Tax-exempt for income up to ₹3 lakh, 5% for ₹3 lakh to ₹5 lakh, 20% for ₹5 lakh to ₹10 lakh, and 30% for above ₹10 lakh.
Super Senior Citizens (aged 80 years and above): Tax-exempt for income up to ₹5 lakh, 20% for ₹5 lakh to ₹10 lakh, and 30% for above ₹10 lakh.
New Regime:
Individuals and HUFs (applicable to all ages): Tax-exempt for income up to ₹2.5 lakh, 5% for ₹2.5 lakh to ₹5 lakh, 10% for ₹5 lakh to ₹7.5 lakh, 15% for ₹7.5 lakh to ₹10 lakh, 20% for ₹10 lakh to ₹12.5 lakh, 25% for ₹12.5 lakh to ₹15 lakh, and 30% for above ₹15 lakh.
How to save income tax?
Some methods to save income tax in India, along with relevant sections or details for each method:
| Method | Section/Details |
|---|---|
| Invest in Tax-Saving Instruments | Section 80C (PPF, NSC, ELSS, etc.) up to ₹1.5 lakh |
| Health Insurance Premiums | Section 80D for self, family, and senior citizen parents |
| Education Loan Interest | Section 80E for higher education |
| Home Loan Benefits | Section 24 (interest) and Section 80C (principal) |
| National Pension System (NPS) | Section 80CCD(1B) over ₹1.5 lakh limit |
| Donations | Section 80G for charitable donations |
| Savings Account Interest | Section 80TTA up to ₹10,000 per annum |
| Rent Paid | Section 80GG for those not receiving HRA |
| Joint Home Loan | Both co-borrowers can claim deductions |
| HRA Exemption | Based on rent, salary component, and city |
| Long-term Capital Gains | Lower tax rates on stocks and mutual funds |
| Advance Tax Planning | Plan at the year start for better decisions |
Who is supposed to pay Income Tax ?
In India, individuals, HUFs, companies, firms, AOPs/BOIs, co-operative societies, trusts, and NRIs are obligated to pay income tax on earnings exceeding exemption limits. Tax liabilities vary by entity and income type, encompassing salaries, property, business profits, capital gains, and other sources, after accounting for eligible deductions and exemptions.
Who should file their taxes ?
In India, individuals must file income tax returns if their income exceeds the exemption limit, own foreign assets, wish to claim tax refunds, or carry forward losses. Companies, firms, and NRIs with Indian income are also mandated to file. High-value transactions and property-related incomes necessitate tax filing as well.
When should I file my taxes ?
For salaried individuals in India, paying income taxes is an ongoing process throughout the financial year, done through tax deducted at source (TDS) by their employer based on the individual’s estimated income and applicable tax slab. However, filing an income tax return (ITR) is a separate annual activity that consolidates your income from all sources, claims for deductions, and reports taxes already paid.
Salaried individuals should file their income tax return by July 31 of the assessment year for the income earned in the previous financial year. For instance, for income earned during the financial year 2023-24 (April 1, 2023, to March 31, 2024), the ITR should ideally be filed by July 31, 2024. This deadline is subject to extensions announced by the Income Tax Department.
Disclaimer
I’m a software expert, not a certified accountant. The tax calculator I’ve developed is based on the information I have, and I cannot guarantee its 100% accuracy. It’s designed to help salaried individuals estimate their potential tax liabilities for planning purposes only and should not be relied upon for determining the exact taxes owed to the government.
Please consult your CA or financial advisor to get more detailed and accurate information. I am not liable for any errors in the calculations made by this tool, as I might have missed some nitty-gritties of the tax law. If you notice any mistakes or inaccuracies, please inform me, by going to Contact-Us page, and I will make corrections as soon as possible. Thanks in advance for that.