• By ADMIN
• Posted 01 Jun, 2021
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FAQ on New tax Regime u/s 115BAC

1. Who are eligible to claim new tax regime u/s 115BAC of the Income-tax Act?

Individuals & HUF

2. What is the slab rate for new tax regime?

Rs.0 – Rs.2,50,000             : Nil

Rs.2,50,001 – Rs.5,00,000   : 5%

Rs.5,00,001-Rs.7,50,000     : 10%

Rs.7,50,001-Rs.10,00,000   : 15%

Rs.10,00,001-Rs.12,50,000 : 20%

Rs.12,50,001-Rs.15,00,000 : 25%

>Rs.15,00,000                  : 30%

3. What are the conditions to be fulfilled to avail the above said new tax regime?

a. The following deductions and exemptions are NOT available.

1. Sec 10(5) – Leave Travel Concession
2. Sec 10(13A) – House Rent Allowance
3. Section 10(14) – Special Allowances
4. Sec 10(17) – Any Allowance to MP & MLA
5. Sec 10(32) – Minor Income deduction of Rs.1500
6. Sec 10AA - Special provisions in respect of newly established Units in Special Economic Zones
7. Sec 16 – Standard Deduction, Tax on Employment & Entertainment Allowance
8. Sec 24(b) – Interest on Self Occupied House Property
9. Sec 32(1)(iia) – Additional Depreciation of 20%
10. Sec 32AD – Investment in new plant or machinery in notified backward areas in certain states.
11. Sec 33AB – Tea development account, coffee development account and rubber development account.
12. Sec 33ABA – Site Restoration Fund
13. Sec 35(1)(ii), (iia) & (iii) – 150% of Donation to Scientific Research
14. Sec 35(2AA) – Sum paid to IIT, National Laboratory & University for Scientific research – 150% deduction
15. Sec 35AD -Deduction in respect of expenditure on specified business (Cold Chain Facility, Warehousing Facility & Hospital etc)
16. Sec 35CCC - Expenditure on Agricultural Extension Project
17. Sec 57(iia) – Deduction with respect to family pension
18. Chapter VI-A Deductions (Except Sec 80CCD(2) & Sec 80JJAA)

b. Without set off if any losses:-

1. Carried forward or depreciation from any earlier assessment year, if such loss or depreciation is attributable to any of the deductions referred above in FAQ No.3(a).
2. Under the head “Income from house property” with any other head of Income

c. Depreciation u/s 32(1)(iia) is not allowed.

d. Without any exemption or deduction for allowances or perquisites, by whatever name called, provided under any other law for time being in force.

e. The loss and depreciation referred to above in FAQ 3(a)(b) shall be deemed to have been given full effect to and no further deduction for such loss or depreciation shall be allowed for any subsequent year. Where there is a depreciation allowance in respect of a block of assets which has not been given full effect to prior to the assessment year beginning on the 1st day of April, 2021, corresponding adjustment shall be made to the written down value of such block of assets as on the 1st day of April, 2020 in the prescribed manner

4. How to opt to the new tax regime?

a. Having business or professional income:-

Option to be exercised on or before the due date for furnishing the returns of income for any previous year relevant to the assessment year commencing on or after the 1st day of April, 2021, and such option once exercised shall apply to subsequent assessment years

b. Having income other than business or professional income: -

Option to be exercised along with the return of income to be furnished under sub-section (1) of section 139 for a previous year relevant to the assessment year:

5. Can the option exercised be opted out?

Yes. once exercised for any previous year can be withdrawn only once for a previous year other than the year in which it was exercised and thereafter, the person shall never be eligible to exercise option under this section, except where such person ceases to have any income from business or profession in which case, option given in FAQ 4(b) shall be available.

6.What if the conditions prescribed not fulfilled or failed to fulfil after opting to the new tax regime?

Where the person fails to satisfy the conditions contained in FAQ 3 above in any previous year, the option shall become invalid in respect of the assessment year relevant to that previous year and other provisions of this Act shall apply, as if the option had not been exercised for the assessment year relevant to that previous year.

Where the option exercised having income from business and profession, in the event of failure to satisfy the conditions contained in FAQ 3 above, it shall become invalid for subsequent assessment years also and existing provisions of the Act shall apply for those years accordingly.