ChatGPT Response On Income Tax Regimes: There is always confusion among taxpayers about which income tax regime is better for them to save taxes. In some cases, the old tax regime can be better due to deductions; while in other cases, the new tax regime should be opted for. Here’s what OpenAI’s artificial intelligence tool ChatGPT says when asked about which tax regime to choose:
Here’s the Response:
“The decision of whether to opt for the new tax regime or the old tax regime depends on your personal financial circumstances, including your taxable income and the deductions and exemptions that you are eligible for.
The new tax regime offers lower tax rates but eliminates many of the exemptions and deductions that were available under the old regime. On the other hand, the old tax regime has higher tax rates but allows for more deductions and exemptions.
It is recommended to evaluate your personal financial circumstances, including your taxable income, deductions, and exemptions, before making a decision. Additionally, you may want to consult with a tax professional to help determine which tax regime would be more beneficial for you. Ultimately, the choice between the new tax regime and the old tax regime will depend on your individual financial situation and tax obligations.”
Also Read: New Income Tax Regime vs Old Regime, Which One Should You Choose In FY24?
The government in the Budget 2023 has announced income tax relief for individual taxpayers, especially under the new income tax regime. Though the new tax regime will now become the default tax regime in 2023-24, taxpayers will still have the choice to opt for the old one.
In the Budget 2023, Finance Minister Nirmala Sitharaman on February 1 announced that those who are earning up to Rs 7 lakh will not have to pay any income tax. In the Budget, the income tax exemption limit has been increased by Rs 50,000 to Rs 3 lakh, and the rebate has been increased from Rs 5 lakh to Rs 7 lakh. Apart from this, the standard deduction, which was available for the old regime, has also been extended to those opting for the new regime.
Also Read: If Your Income Is Just Rs 10 Above Rs 7 Lakh, This is The Tax You’ll Pay
An independent tax professional told news18.com, “Though without any savings, investments and deductions, the new tax regime seems beneficial; the old tax regime can be attractive if you make use of savings, investments, and deductions.”
According to a PTI report quoting a senior finance ministry official, if taxpayers claim deductions and exemption claims less than Rs 3.75 lakh annually, it would be advised for them to opt for the new income tax regime and pay less tax than they give in the old regime.
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