Download Excel based Income Tax Calculator for FY 2020-21 & AY 2021-22/ Income Tax Calculator Excel Download
Planning for your income tax or calculating your income tax liabilities seems to be a very daunting task for many of us. If you believed in this myth, surely the Finance Budget 2020 would prove you wrong.
Now as per Budget 2020, to add salt to the injury, not only you are required to manage your taxes but also you have to decide which income tax regime is beneficial to you.
It is not clearly known to me whether there are any other countries in the world where two different income tax slab is operational simultaneously.
India has never had two separate and parallel income tax regime in the history of income tax. But I am sure that the revenue department does believe in ‘Change is the only constant’ proposition.
The Finance Minister has clearly told in her budget speech that this new tax regime will definitely give relief to the tax-payers. Therefore, in this post, you would see a comparative analysis of the Income Tax Calculator F.Y 2020-21 and find out whether it is indeed beneficial or not.
While I have decided to write a post on Income Tax Calculator FY 2020-21(AY 2021-22). Let’s just see the major Pros and Cons of the two tax regimes.
Comparison of 2 Tax Regimes (Old Vs New)
Old Tax Regime
- It encourages investment in tax saving instruments
- Existing income tax deductions are allowable
- Standard deductions and Professional tax are deducted from income
- This tax regime is more beneficial for income up to Rs.15 Lakh.
New Tax Regime
- It discourages investments to save tax
- No existing deductions are allowable
- No deduction permissible for Standard Deduction & Professional tax
- This tax regime is more beneficial for income above Rs.15 Lakh.
Before, digging into the deep let’s just see what are the important highlights of the New Income Tax Regime for F.Y 2020-21.
The following Income Tax Deductions are not allowed under new Tax Regime 2020
- Standard Deduction on Salary income is not allowed any more;
- Professional Tax also not allowed under the new tax regime;
- Deduction on account of Income from House Property i.e. interest on the self-occupied house not allowed now;
- Set off of carried forward losses and Depreciation are not permitted now;
- Deductions for any allowance are not allowed now;
- Main deductions U/S 80 C, 80 CCC, 80 D, 80E, 80 U, 80 G and etc. are not allowed under the new income tax regime.
Income Tax Slab applicable for F.Y 2020-21 and A.Y 2021-22
Income Tax Slab applicable for F.Y 2020-21 and A.Y 2021-22
Old Tax Regime for General Taxpayers up to 60 Years of Age
| Sl No | Tax Slab(₹) | Tax Rate | Income Tax (₹) |
| 1 | Income up to ₹2,50,000 | 0 | Nil |
| 2 | ₹2,50,00 to ₹5,00,000 | 5% | Taxable Income X 5% |
| 3 | ₹5,00,001 to ₹10,00,000 | 20% | ₹12,500 + (TI – ₹5,00,000) X 20% |
| 4 | More than ₹10,00,000 | 30% | ₹1,12,500 + (TI – ₹10,00,000) X 30% |
Income Tax Slab applicable for F.Y 2020-21 and A.Y 2021-22
New Tax Regime for General Taxpayers up to 60 Years of Age
| Sl No | Tax Slab(₹) | Tax Rate | Income Tax (₹) |
| 1 | Income up to ₹2,50,000 | 0 | Nil |
| 2 | ₹2,50,00 to ₹5,00,000 | 5% | Taxable Income X 5% |
| 3 | ₹5,00,001 to ₹7,50,000 | 10% | ₹12,500 + (TI – ₹5,00,000) X 10% |
| 4 | ₹7,50,001 to ₹10,00,000 | 15% | ₹37,500 + (TI – ₹7,50,000) X 15% |
| 5 | ₹10,00,001 to ₹12,50,000 | 20% | ₹75,000 + (TI – ₹10,00,000) X 20% |
| 6 | ₹12,50,001 to ₹15,00,000 | 25% | ₹1,25,000 + (TI – ₹12,50,000) X 25% |
| 7 | More than ₹15,00,000 | 30% | ₹1,87,500 + (TI – ₹15,00,000) X 30% |
No Deductions are allowed as per New Tax Regime
Income Tax Slab applicable for F.Y 2020-21 and A.Y 2021-22
Old Tax Regime for Senior Citizen above 60 Years of Age
| Sl No | Tax Slab(₹) | Tax Rate | Income Tax (₹) |
| 1 | Income up to ₹3,00,000 | 0 | Nil |
| 2 | ₹3,0,00 to ₹5,00,000 | 5% | Taxable Income X 5% |
| 3 | ₹5,00,001 to ₹10,00,000 | 20% | ₹10,000 + (TI – ₹5,00,000) X 20% |
| 4 | More than ₹10,00,000 | 30% | ₹1,10,000 + (TI – ₹10,00,000) X 30% |
Income Tax Slab applicable for F.Y 2020-21 and A.Y 2021-22
New Tax Regime for Senior Citizen above 60 Years of Age
| Sl No | Tax Slab(₹) | Tax Rate | Income Tax (₹) |
| 1 | Income up to ₹3,00,000 | 0 | Nil |
| 2 | ₹3,00,00 to ₹5,00,000 | 5% | Taxable Income X 5% |
| 3 | ₹5,00,001 to ₹7,50,000 | 10% | ₹10,000 + (TI – ₹5,00,000) X 10% |
| 4 | ₹7,50,001 to ₹10,00,000 | 15% | ₹35,000 + (TI – ₹7,50,000) X 15% |
| 5 | ₹10,00,001 to ₹12,50,000 | 20% | ₹72,500 + (TI – ₹10,00,000) X 20% |
| 6 | ₹12,50,001 to ₹15,00,000 | 25% | ₹1,22,500 + (TI – ₹12,50,000) X 25% |
| 7 | More than ₹15,00,000 | 30% | ₹1,85,000 + (TI – ₹15,00,000) X 30% |
Income Tax Calculator F.Y 2020-21:Which Tax Regime is beneficial to you-Old or New?
Before budget 2020, you had to only manage your taxes i.e. finding various tax saving instruments to save tax or reduce your tax liabilities.
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We all were habituated to this. But from now you are required to analyse which tax regime is beneficial to you. Let us analyse below and see which tax regime is more advantageous.
Comparative Analysis: Old Tax Regime Vs New Tax Regime:
Condition 1– Mr X receives a gross salary of Rs. 5 lakh to 20 Lakh for F.Y 2020-21. His investment in Section 80C is Rs.1.5 Lakh and Mediclaim insurance U/S 80D is Rs.20,000 only. Professional Tax deduction Rs.2,400 per year. Compute his tax liability under both tax regimes.
Gross salary range – Rs. 5 Lakh to Rs. 20 Lakh. 80 C deduction- Rs.1.5 Lakh. Mediclaim insurance- Rs.25000. Tax on employment- Rs.2400.
Computation of Income Tax Liability under both tax regimes:
| Gross Salary | Income Tax Liability(Old Regime) | % of Tax on Gross Salary | Income Tax Liability(New Regime) | % of Tax on Gross Salary | Difference in Tax Liability | Winner (Old Regime/ New Regime) |
| ₹ 5,00,000 | Nil | – | Nil | – | Nil | None |
| ₹ 7,50,000 | ₹ 17,700 | 2.36% | ₹ 39,000 | 5.20% | ₹-21,300 | Old Regime |
| ₹ 10,00,000 | ₹69,700 | 6.97% | ₹ 78,000 | 7.80% | ₹ -8,300 | Old Regime |
| ₹ 12,50,000 | ₹ 1,24,050 | 9.92% | ₹ 1,30,000 | 10.40% | ₹ -5,950 | Old Regime |
| ₹ 15,00,000 | ₹ 2,02,050 | 13.47% | ₹ 1,95,000 | 13.00% | ₹ 7,050 | New Regime |
| ₹ 20,00,000 | ₹ 3,58,050 | 17.90% | ₹ 3,51,000 | 17.55% | ₹ 7,050 | New Regime |
Therefore, from the above analysis, you can see that after availing off income tax deductions, Old tax regime is beneficial up to the income level of Rs. 12.50 Lakh. But when income exceeds Rs.15 lakh, the New tax regime is beneficial.
So, while deciding which income tax regime to choose, you must consider the compulsory investments and voluntary investments.
I mean if the compulsory investments(can’t avoid) like GPF, EPF, NPS are Rs1.5 Lakh altogether, and you need medical insurance for your family, you can avail such deduction and choose the Old tax regime.
On the other hand, if there are no compulsory investments, would you invest voluntarily Rs. 1.75 Lakh to save tax for Rs.8,300 and Rs.5,950 respectively for income level Rs.12.50 Lakh and Rs.15 Lakh respectively.
Winner as per the above analysis:
Old Tax Regime 3 times up to an income of Rs.12.50 Lakh and New Tax Regimes 2 times for income exceeding Rs.15 Lakh.
Conclusion: If you have to pay interest on the Home loan and compulsory deductions, in that case, the Old Tax Regime a clear Winner.
Condition 2- Mr X receives a gross salary of Rs. 5 lakh to 20 Lakh for F.Y 2020-21. He has no investments. Professional Tax deduction Rs.2400 per year. Compute his tax liability under both tax regimes.
| Gross Salary | Income Tax Liability(Old Regime) | % of Tax on Gross Salary | Income Tax Liability(New Regime) | % of Tax on Gross Salary | Difference in Tax Liability | Winner (Old Regime/ New Regime) |
| ₹ 5,00,000 | Nil | – | Nil | – | Nil | None |
| ₹ 7,50,000 | ₹ 54,100 | 7.21% | ₹39,000 | 5.20% | ₹ 15,100 | New Regime |
| ₹ 10,00,000 | ₹1,06,100 | 10.61% | ₹78,000 | 7.80% | ₹ 28,100 | New Regime |
| ₹ 12,50,000 | ₹ 1,78,650 | 14.29% | ₹1,30,000 | 10.40% | ₹ 48,650 | New Regime |
| ₹ 15,00,000 | ₹2,56,650 | 17.11% | ₹1,95,000 | 13.00% | ₹ 61,650 | New Regime |
| ₹ 20,00,000 | ₹4,12,650 | 20.63% | ₹3,51,000 | 17.55% | ₹ 61,650 | New Regime |
From the above comparative analysis, it is evident that if you don’t have 80C deductions or minimal deductions U/S 80C, no interest on house building loan, in that case, the New Tax Regime is a clear winner.
Winner as per the above analysis:
New Tax Regime is a clear winner for all 5 income levels.
Conclusion: So, in case of no deduction U/S 80 C or Interest on Home Loan, the New Tax Regime a clear Winner.
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