Income Tax Calculator Software 2020-21


Update: Easy Tax by Alrahiman is updated to Version 21.04. (Date 28-01-2021) There was an error in calculation of New Regime, whose total income is above 10 Lakhs. Such people please download new version and use import data from old version option in the software to update without losing data already entered

The Income Tax software tools for 2020-21 is to be released. Not like previous years, it can be calculated in two different schemes and the suitable one can be selected this time. Hence the software was with a few difficulties, it has been done with utmost care and correctness of the calculations be examined and if any mistakes are noticed it be emailed. 

The major changes in the income tax in the financial budget presented by the Honorable Minister Smt Nirmala Sitaraman are also considered in the software preparation. There is no change in the rate of income tax of the previous year where as a new scheme called New Regime was also presented. 

As it is optional, those willing to change to this new scheme can do so or they can follow the scheme of the previous years. 

Old Regime

In the old scheme, there were different Tax slab for groups such as super senior citizen senior citizen and an ordinary citizen. As per this scheme, taxable income (total income) is calculated after various deduction from income and tax will be according to this. Here, there was chance for tax deduction by focusing on the deposits and such.

Category
Taxable Income
Tax Rate
Till the age of 60Taxable upto Rs.2.5 lakhNil
Above Rs 2.5 lakh to 5 lakh5%
Upto Rs.10 lakh20%
Above Rs.10 lakh30%
From the age of 60Taxable upto Rs.3 lakhNil
Above Rs 3 lakh to 5 lakh5%
Upto Rs.10 lakh20%
Above Rs.10 lakh30%
From the age of 80Taxable upto Rs.5 lakhNil
Above Rs 5 lakh to 10 lakh20%
Above Rs.10 lakh30%

New Regime 

The tax is calculated in the new scheme by classifying the income limits into 7 slabs each one is that of Rs 2.5 lakh compared to the old scheme. Though the tax rate is lesser here, the peculiarity of this scheme is that no deductions from the total income are not allowed here. The deductions under professional tax, Entertainment allowance, HRA, Standard deduction, NPS contribution Housing loan deductions, 80 C chapter VI A are not allowed here and the gross income is the taxable income here.

If the taxable income is below 5 lakh, Rs 12,500/ as per section 87(A) of old scheme is permitted here too and there is no such classification as ordinary citizen, senior citizen and super senior citizen. A single tax rate slab only is there considering all are equal.

Category
Taxable Income
Tax Rate
New Income Tax Slab & RateTaxable upto Rs.2.5 lakhNil
Above Rs 2.5 lakh to 5 lakh5%
Above Rs.5 lakh to 7.5 lakh10%
Above Rs.7.5 lakh to 10 lakh15%
Above Rs.10 lakh to 12.5 lakh20%
Above Rs.12.5 lakh to 15 lakh25%
Above Rs.15 lakh30%

Housing loan and New tax system 

In the scheme that was followed in the previous years, the amount remitted towards principal amount of the housing loan was considered to be deduction in 80 C up to an amount of rupees one and half lakh and up to Rs 2 lakh towards interest as deduction in income from house property whereas these two deductions are not available in the new scheme. Moreover, the rent received from house that was let should be given as income, in income from House property. 

The advantage of the new scheme here is that the interest for the housing loan can be reduced from this income and the maximum amount that can be deducted is limited to, in the income from rent as such things can't be allowed to be deducted from other income. A deduction of upto Rs 2 lakh was available in this in the old scheme. 

Which is better? 

For the question which scheme is better, a sudden and single answer is not possible. It may vary and depend upon the individual's deduction scheme The fact is that, for those who have availed of the deductions possibilities to the maximum, following the old scheme would be better. Anyway, you need not think over this much. This job would be done by the software. 

The software is prepared in such a way that both scheme statements can be generated from a common single entry. Once the details are entered, two statements, Old Regime and New Regime can be opened. The statement with lesser Tax amount can be printed out and submitted in the office.
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