If your annual income is Rs. 8 lakhs in India, then you must be thinking which tax regime is better for 8 lakhs? The new tax regime generally works out better unless you have significant deductions to claim. I have shared the reasons for your reference.
Under the new regime for FY 2024 to 25, the tax slabs are:
Up to Rs. 4 lakh: 0%
Rs. 4 to 8 lakh: 5%
This means your entire Rs. 8 lakh is taxed at only 5%, plus a Rs. 75,000 standard deduction, making it simple and low-tax.
By contrast, the old regime taxes as:
Up to Rs. 2.5 lakh: 0%
Rs. 2.5 to Rs. 5 lakh: 5%
Rs. 5 to Rs10 lakh: 20%
However, under this regime, you can claim several deductions:
Standard deduction: Rs. 50,000
Section 80C investments (e.g., PPF, ELSS): up to Rs. 1.5 lakh
Health insurance (Section 80D), HRA, etc.
To match the new regime’s net tax (around Rs. 23,400), you’d need total deductions before the old-regime standard deduction amounting to roughly Rs. 2 lakh unlikely unless you have both large tax-saving investments and significant HRA/home-loan interest.
For typical salaried individuals earning Rs. 8 lakhs without Rs. 2 lakh+ in deductions, the new regime is simpler and cheaper no proof of investments needed, and tax calculation is straightforward.
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Which Tax Regime is Better for 8 Lakhs?
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2025-07-18T09:45:12+00:00 2025-07-18T09:45:14+00:00Comment
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