{"id":8810,"date":"2020-04-20T05:51:29","date_gmt":"2020-04-20T05:51:29","guid":{"rendered":"\/blog\/?p=8810"},"modified":"2020-04-20T05:58:25","modified_gmt":"2020-04-20T05:58:25","slug":"constant-changes-in-the-income-tax-structure-highlight-the-need-for-wealth-management","status":"publish","type":"post","link":"https:\/\/tata-blog.osian.dev\/blog\/wealth-services\/constant-changes-in-the-income-tax-structure-highlight-the-need-for-wealth-management\/","title":{"rendered":"Constant Changes in the Income Tax Structure Highlight the Need for Wealth Management"},"content":{"rendered":"\n

A few years ago, a survey conducted by Deloitte mentioned that India had the second-most complex taxation systems in the Asia-Pacific region, second only to China. Now in 2020, when taxpayers were expecting simplification in the process, the recent Budget, rather than simplifying the income tax structure, made things more complicated for taxpayers.<\/p>\n\n\n\n

By proposing an alternate tax structure, Budget 2020 dashed the\nhopes of taxpayers expecting\nlower tax slabs, increased exemptions and simplicity in the filing of\nincome tax returns. Now taxpayers have two paths to choose causing a lot of\ndilemma and confusion. According to the new income tax structure, taxpayers can\neither forego all types of exemptions and deductions entirely to enjoy a lower\ntax structure or avail exemptions and deduction while paying the previous tax\nrate, which is quite high.<\/p>\n\n\n\n

The constant revisions in the tax system and the latest changes\nin the income tax structure after Budget 2020 have added to the complexity of\nour income tax system. This highlights the need for wealth management services,\nas you need to realign your investment\nplans and optimize tax savings and wealth creation. A wealth manager will\nalso help you understand whether you should continue investing in tax saving mutual funds\nand other tax saving\nschemes. <\/p>\n\n\n\n

Additional Read:- <\/strong>How Can Wealth Management Help\nYou Save on Tax?<\/a><\/p>\n\n\n\n

Old\n& New Tax Slabs & Rates<\/strong><\/p>\n\n\n\n

\"Old<\/figure><\/div>\n\n\n\n

Source: Economictimes.indiatimes.com<\/p>\n\n\n\n

Choosing between the new and\nold tax regime<\/strong><\/p>\n\n\n\n

Indian taxpayers are now left with an enormous task before filing\ntheir income tax return in July this year. For the sake of simplicity, they can forego\nall the deductions and exemptions and opt for a lower tax rate, but what about\nall the tax benefits they have been deriving from their investment plans until 2019.<\/p>\n\n\n\n

Suddenly, all the money that they have invested in tax saving schemes, tax saving mutual funds<\/a> such as ELSS, life insurance plans\nand ULIPs are not eligible for deductions and exemptions if they go for the new\nincome tax structure. While the new income tax structure may suit those with\nminimum tax saving investments, it may not be favourable for those who have\ninvested in various tax saving schemes.<\/p>\n\n\n\n

Tax planning post Budget 2020 has certainly become more complex\nand it highlights the need for wealth management services. Tata Capital Wealth, with\na legacy of Tata\u2019s trust among customers, specialises in bespoke investment,\nprotection and financing solutions that are designed according to your\nfinancial goals. At a time when there is economic uncertainty and tax\ncompliance and enforcement is getting stricter and complex, Tata Capital Wealth can\nhelp you navigate the choppy waters with ease.<\/p>\n\n\n\n

Exemptions & deductions\nthat are out<\/strong><\/p>\n\n\n\n

Under the new tax regime, you will have to forego 70 exemptions\nand deductions that are available to taxpayers who prefer to stay with the old\ntax structure. Here are some of the major ones that a lot of taxpayers used to\nrely on:<\/p>\n\n\n\n