Aryan (25 years) and Aditya (32 years) are two individuals, resident in India, and they earned salary of 13 lakhs each during the previous year…

Computation of Tax Liability of Mr. Aryan & Mr. Aditya for the A.Y. 2024-25 as per section 115BAC Particulars Mr. Aryan Mr. Aditya Income under the head "Salaries" Salary 13,00,000 13,00,000 Less: Standard deduction u/s 16(ia) 50,000 50,000 12,50,000 12,50,000 Less: Set-off loss from house property in respect interest on loan for self-occupied property [not allowable as deduction u/s 115BAC] - - Gross Total Income 12,50,000 12,50,000 Less: Deduction under section 80D & 80GGC [Not allowable as deduction u/s 115BAC] - - Total income as per section 115BAC 12,50,000 12,50,000 Tax Liability Upto 3,00,000 Nil Nil 3,00,001 to 6,00,000 @ 5% 15,000 15,000 6,00,001 to 9,00,000 @ 10% 30,000 30,000 9,00,001 to 12,00,000 @ 15% 45,000 45,000 12,00,001 to 12,50,000 @ 20% 10,000 10,000 1,00,000 1,00,000 Add: Health and education cess @4% 4,000 4,000 Tax Liability 1,04,000 1,04,000 Computation of Tax Liability of Mr. Aryan & Mr. Aditya for the A.Y. 2024-25 as per regular provisions of Income-tax Act Particulars Mr. Aryan Mr. Aditya Income under the head "Salaries" Salary 13,00,000 13,00,000 Less: Standard deduction u/s 16(ia) 50,000 50,000 12,50,000 12,50,000 Less: Set-off of loss from house property in respect of interest on loan borrowed for self-occupied property, restricted to 2,00,000, as per section 71(3A) - 2,00,000 Gross Total Income 12,50,000 10,50,000 Less: Deduction u/s VI-A Section 80D – Medical insurance premium 24,000 - Section 80GGC – Contribution to political party by cheque - 1,50,000 Tax Liability 12,26,000 9,00,000 Upto 2,50,000 Nil Nil 2,50,001 to 5,00,000 @ 5% 12,500 12,500 5,00,001 to 10,00,000 @ 20% 1,00,000 80,000 Above - 10,00,000 @30% 67,800 - 1,80,300 92,500 Add: Health and Education cess @4% 7,212 3,700 Tax liability 1,87,512 96,200 Tax liability (rounded off) 1,87,510 96,200 Since tax liability of Mr. Aryan as per section 115BAC of 1,04,000 is lower than the tax liability of 1,87,510 computed as per the regular provisions of the Act, it is advisable for him to not to opt out of section 115BAC. However, in case of Mr. Aditya, since his tax liability as the normal provisions of 96,200 is lower than the tax liability of 1,04,000 as per section 115BAC, it is advisable for him to opt out of the default tax regime under section 115BAC and pay tax as per regular provisions.