The new income tax regime is now the default choice for income taxpayers under budget 2023. Therefore, the updated new income-tax system will apply unless a person declares that they are choosing the old income tax regime.
Many taxpayers may now question if the advantage of switching between the old and new income tax regimes will still persist.
Can we shift between old and new tax regime, or we cant come back to old?
Ans : In every financial year, an individual might decide to switch between the old and new taxation system. However, only those with salaried income who do not also have company income have the choice of switching between the old and new tax regimes. We can come back to old from new only once
Who is unable to alternate between the two systems every year?
Ans :Individual taxpayers with company income are not allowed to alternate annually between the old tax system and the new tax system, according to income tax legislation. The new income tax system is an option for both individual taxpayers and HUFs with company income.
But, once they have decided to join, they will only get one chance to go back to the previous tax system. If they have already selected the previous income tax system, they won't be able to adopt the new one in future fiscal years.
Can you choose a different income tax regime while filing ITR vis-à-vis employer?
Irrespective of what was disclosed to the employer, the income tax laws let an individual to select any income tax regime. Therefore, you have the choice to choose the old tax system when submitting an ITR if you choose the new tax regime with your employer. Make sure the ITR is filed by July 31 or before.