The Income Tax Department has launched a tax calculator to help taxpayers decide between the new and old tax regime. The calculator will enable millions of taxpayers to calculate their tax, making it easier for them to decide which system of tax is better for them. The tool has been released well in advance of the new financial year starting on April 1, allowing taxpayers plenty of time to calculate their taxes.
To use the calculator, taxpayers should visit the Income Tax Department's website and fill in details such as their total investment amount, assessment year, tax pay category, residential status, total income, investment exemption, and standard deduction. They must also enter their age group as per the government's classification. Once all the required information is entered, the calculator will display the tax liability created under the new and old tax systems.
While the tax calculator is helpful, tax expert Sushil Jain suggests that taxpayers must prepare before using it. They should gather complete details of investment exemption and income from other sources, such as interest income, rental income, and home loan interest. They should also check their insurance policy's premium amount before using the calculator.
The government's intention behind launching the tax calculator is to make the new tax system attractive to taxpayers. CBDT Chairman Nitin Gupta expects 40 to 50 percent of taxpayers to adopt the new tax system, which will be beneficial for them.
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