One can adopt this tax regime for refund of TDS deducted from salary, with the benefit of forward deduction

Filling TDS in ITR: TDS is deducted from the salaries of many salaried employees. Refund of this TDS can be claimed while filing income tax return at the end of the financial year. It is essential to choose the right tax regime to avail the benefits of this TDS (Tax Deducted at Source) deduction. Let us know which method you can adopt to get more benefit from the old and new tax system.

The employee has to inform his employer about the choice of new or old tax method. Because, TDS is deducted based on the income tax slab applicable in the system chosen by the employer. If TDS is deducted on salary as per the old system then they can avail various deductions under this system. You can claim the amount of deduction shown in Form 16 submitted by the employer. Whereas in the new tax regime, you can only get refund of deductions allowed and claimed under Section 80CCD and standard deduction mentioned in Form-16.

Benefit of TDS refund in which tax regime?

Both new and old tax regimes are eligible for various benefits of tax deduction. The two deductions applicable in the new tax system are also acceptable in the old tax system. Apart from this, it also includes other deductions.

Keep these things in mind

If any discrepancy is found between the details of income, tax exemptions and deductions shown as per Form 16 and the details issued in the income tax return, the Income Tax Department may face action. Therefore, the details of these additional deductions and exemptions should be shown on the basis of valid evidence. This evidence may have to be submitted when the ITR is processed by the CPC of the Income Tax Department, which rejects the conflicting claim.

The option of old tax resume for TDS claim is convenient and safe. In which you can get refund on all allowed tax exemptions and deductions. If TDS is deducted from salary then select Tax Resume to claim from the beginning of the new financial year, which would be advisable because if you select this while filing ITR, the employer may have to change some details in Form-16.

new tax system

In the new tax regime, as per the old tax regime, one cannot claim deductions including Section 80C, Section 80D and Section 80CCD(1B). In the new tax regime, Rs. 50 thousand are allowed as deductions including standard deduction and pension income, employer's contribution to NPS account.