New Delhi: The Income Tax Department on Thursday launched an e-calculator for individuals to estimate and compare their tax liability under the new tax slabs as compared to the existing regime, officials said on Thursday.
The calculator, launched earlier in the day, was updated by the department in the evening to make it more "user friendly". It largely gives the user three broad results based on the kind of individual financial data fed into it, a senior official said.
It will either tell the user about the tax benefit as per the new regime (as proposed in the budget), tax benefit as per the existing or old system and lastly if tax outflow for the user is same in both old and new regime.
This will help an individual take an informed decision of opting either the tax slab while filing their income tax return (ITR) next year, the official said.
Taxpayers in three age categories of normal citizen (below 60 years), senior citizen (60-79 years) and super senior citizen (above 79 years) can punch in their estimated annual income, total eligible deductions and exemptions to see what will be their total taxable income if they continue in the old regime or opt for the new one which will not allow any deductions and exemptions.
The calculator, once fed with data, promptly informs the user about the actual amount of money that can be saved by opting either of the two regimes.
A tab for the calculator has been placed on the homepage of the official e-filing website of the department -- https://www.incometaxindiaefiling.gov.in -- and upon clicking it takes the user to the next page meant for calculating tax liability for resident individuals (financial year 2020-21).
This web portal is otherwise used for filing of e-ITRs by individuals and various other categories of taxpayers.
"This calculator is only meant to provide basic idea of the estimated impact of the new provisions. Refer to the Income Tax provisions for the actual provisions and eligibility," a disclaimer posted on the link said.
In the new personal income tax regime as proposed by Union Finance Minister Nirmala Sitharaman in her budget speech on February 1, five per cent tax is levied on an annual income between Rs 2.5 lakh to Rs 5 lakh.
The tax rate rises to 10 per cent, 15 per cent, 20 per cent and 25 per cent for every Rs 2.5 lakh addition. A 30 per cent tax is charged for income over Rs 15 lakh.
The old or the existing income tax rate regime allows a standard deduction of Rs 50,000 and investment of Rs 1.5 lakh in saving schemes with a rate of 5 per cent, 10 per cent or 30 per cent tax depending on various income levels.