If you think you have made a mistake while selecting between the new and old tax regimes, then here is the way to switch back to the scheme you desire.
Through the Current Financial year’s Budget, Union Minister Nirmala Sitharaman announced the new tax regime as voluntary compliance. Taxpayers, especially employees, are allowed to choose between the old and new regimes as per their preference.
As the protocol says at the beginning of every financial year, the employees are required to inform their employer about the tax regime they wish to follow.
Need Software for Easy ITR Filing
For instance, if you first wish to go with the old tax system but eventually find the new tax regime more beneficial for you then there is a way for you to switch to the new tax regime.
While Filing an ITR
The government has given the employees the choice between the old and the new tax regime. The decision normally has to be taken at the beginning of the financial year but in case if you have chosen the old tax regime but you find a new system much more beneficial for you then you can switch to the new system while filing the Income tax return
Anytime in the financial year before the ITR filing, you cannot switch to another regime.
Old Tax System V/S New Tax System
The new tax regime is the lower tax regime which means it has reduced rates of taxes but the system does not allow any tax reduction based on tax-saving investments like the old tax regime. On the other hand, the tax slabs under the old tax regime remain untouched but here you can avail deductions on tax-saving investments.
Tax Slabs Under the New Tax Policies
As per the new tax regime, no tax applies to income up to Rs 3 lakh per annum. Above that:
- A 5% tax is applicable on income from 3 lakh to 7 lakh per annum
- 10% tax is applicable on income from 7 lakh to 10 lakh per annum
- 15% tax is applicable on income from 10 lakh to 12 lakh per annum
- 20% tax is applicable on income from 12 lakh to 15 lakh per annum
- 30 % tax is applicable on income more than 15 lakhs per annum
Along with relevant cess and surcharges.
Read Also: A Summary of Tax Calculator with Pros Under New Tax Regime
What to do in Case of More Tax Outgo?
As per the laws, the employees have to choose between the old and the new tax regime and inform their employers about their choices, however, if one is not certain about the choice then he/she can certainly change his/her decision at the time of ITR filing.
In case the employee encounters that the tax deducted is more than the actual payable amount, then he/she can claim the refund (by filling online refund application) for that extra tax while filing the Income-tax refund.
I wrongly opted for a new tax regime which led me to lose a big chunk in my February salary, can I get the deducted amount refunded if I again choose the old tax regime?
My employer has deducted tax as per the new regime & it has noticed me in Jan 21. Now they are not changing from new to the old regime and unable to save tax-saving against house rent, Child Education, NPS, Housing loans. As per IT Guideline – Can Employer change Regime any time in this Fy Year & During ITR – Can I get a refund by selecting Old Regime.
I am a Doctor and a government Employee.
I have both Salaried and professional income. I submitted my Tax declaration for FY 2020-2021, to my employee in the old regime.
But I want to submit my income Tax return in the new regime at the time of filling of my income tax return in July 2021.
Is my salary with professional income create any problem to switch from the old regime to the new regime at the time of filing income tax.
Why the Employer is not able to recall the Tax regime selection option again… I have selected a new tax regime mistakenly, but not able to switch back to the old regime now…
I made the same mistake or rather my companies system made a fault and made me choose the new tax regime. Now more tax is deducted every month and I have been told that I need to select the old regime at the time of filing the ITR to claim a refund. I do not know I can submit my investment proofs while filing the ITR as during ITR filing there is no provision to attach investment proofs. Just wait and watch.
There is no option to shift the regime but you can submit your return as per the regime that you want(old regime). Extra TDS deducted will get refunded to you.
I see everywhere that we can switch between Old and New Regime while I submit my ITR irrespective of what I declare to my employer. But I want to know how to do that while submitting the ITR. Where can I find that option to switch? My IT has been deducted as per the new Tax regime, while submitting the ITR, where can I switch back to the old tax regime in the ITR declaration portal?
Did you find out the solution for this? have you able to find how to switch if yes please let me know
I want to change my preference of tax filing from new regime to old regime because it is beneficial to me. As I had opted the new regime my prefilled data indicates higher tax liability. Please guide me how can I change it
Hi, I made the same buy mistake. I selected a new regime still if i submit investment proofs i will get a refund amount? if yes how can i do can you guys help on this
All are writing the same problem. None is giving a solution. This shows we are all following sheep. without hurt to them
Do you this you reply is satisfactory, It indicates that how much serious about your subscribers who are using SAG software
I am also facing same issue. did you find any solution?
Do I need to furnish the rent agreement and rent slip….while filling ITR as per old norms….I have selected a new regime.