The new regime has significantly fewer deductions available compared to the old regime.
The new tax regime offers lower tax rates but limits the available deductions and exemptions.
Standard Deduction: Salaried individuals and pensioners can claim a standard deduction of ₹75,000.
Family Pension: A deduction of ₹25,000 or one-third of the pension (whichever is less) is allowed from family pension income.
Employer’s Contribution to NPS: Deduction for the employer’s contribution to a National Pension System (NPS) account is allowed up to 14% of salary (for Central/State Government employees) or 10% (for others) under Section 80CCD(2). This is outside the common Section 80C limit.
Agniveer Corpus Fund: Contributions to the Agniveer Corpus Fund under Section 80CCH are allowed as a deduction.
Most common deductions like Section 80C, 80D, HRA exemption, and interest on self-occupied house property are not available under the new regime.
Tushar Tyagi,
Rupesh Mangal & Associates
CHARTERED ACCOUNTANTS