[Query] Income Tax Regime - Change from old to new while filing ITR
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For FY 2023-24, I had chosen Income Tax Regime as 'Old' and since I'm a salaried employee, all the deductions have been done considering 'Old' regime.
My query is, can I choose 'New' regime while filing ITR and see which regime is giving me better tax savings out of two?
Reason for this is, I didn't claim HRA since I'm working from home and because of that I think new regime will be more beneficial in my case.
This year onwards, I'm thinking to transfer money to my maternal grandmother's bank account and claim HRA later on. For FY 2023-24, I didn't transfer any amount to her bank account and I'm in dilemma whether to claim HRA or not. I can show the income from rent while filing her ITR but just in case I'm asked for any proof, I won't be able to produce any, not even bank account statement.
Also, what exact deductions are part of new regime, if anyone has a brief list, will be helpful.
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There is only one commonly available deduction in new regime, standard deduction.
So if your income is upto 7.5L, you don't have to pay any tax.
Also like @B3A5T said, if you have more deductions than the amount he specified, old regime is still beneficial.
If hra is the only deduction you want to claim other than standard deduction, you would be better off in new regime.
If your grandmother has the property you want to "rent" in her name, everything is rather simple.
Just make a rent agreement(nothing fancy, just who is renting from who @how much per month), have it signed by both parties.
Transfer rent from your account to one specific account of your grandmother, every month at the same date.
This is enough proof if you ever need it.
Also, if you income is less than 5L after deductions, stay in old regime. You know, to keep it alive.
I suggest being in the old regime itself and claiming HRA in the current assessment year ITR. No one checks these things manually, and even with automated checks, these things will never be caught unless you have planned to claim more than 5-6L HRA deduction.
Big companies, banks, and financial institutions are doing thousands of crores of fraud and no one taking a look there so 2-4L of HRA is nothing compared to them.
The rest is up to you.
And regarding your question, for salaried person, you can always switch your regime while filing ITR without any problem.
Just for reference. You can always check both the regime calculations and then can proceed.
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Yes, you can opt for new regime at the time of filing.
And for 2nd question, if your income is above 15L, the delta between the Old regime and New regime is around 3.75 lakhs. So if you have that much of deductions in old regime, then go for it, else new regime would be beneficial for you.