Tax Deducted at Source (TDS) is income tax deducted from money paid at the time of making payments to the employee like rent, salary, interest, bonus, etc. by the company.
Challan is issued when the taxpayer deposits TDS and TCS.
As per the new tax regime in the Union Budget, 2020. There is an option for individuals and HUF to pay taxes at lower rates without claiming deductions under various sections. The new regime and old regimes tax rates are mentioned below:
|Income Tax Slab (inr)||Tax Rates As Per New (inr)||Tax Rates As Per Old Regime (inr)|
|0 - 2,50,000||Nil||Nil|
|2,50,001 - 5,00,000||5%||5%|
|5,00,001 - 7,50,000||12500 + 10% of total income exceeding 5,00,000||12500 + 20% of total income exceeding 5,00,000|
|7,50,001 - 10,00,000||37500 + 15% of total income exceeding 7,50,000||62500 + 20% of total income exceeding 7,50,000|
|10,00,001 - 12,50,000||75000 + 20% of total income exceeding 10,00,000||112500 + 30% of total income exceeding 10,00,000|
|12,50,001 - 15,00,000||125000 + 25% of total income exceeding 12,50,000||187500 + 30% of total income exceeding 12,50,000|
|Above 15,00,000||187500 + 30% of total income exceeding 15,00,000||262500 + 30% of total income exceeding 15,00,000|
New tax regime slab rates are not differentiated based on age group. However, under old tax regime the basic income threshold exempt from tax for senior citizen (aged 60 to 80 years) and super senior citizens (aged above 80 years) is inr 3 lakh and inr 5 lakh respectively.
However, under new tax regime person cannot claim up to 70 income tax deductions while calculating taxes. Hence, every person has to make his/her own calculation as per old and new tax regime and calculate which one is beneficial based on type of investments made and returns earned on those investments.