The new tax regime is effective from FY 2020-21. Employees choosing the new tax regime for the FY 2020-21 cannot claim any deductions or exemptions as available under the old regime. The CBDT now notifies specific allowances an employee can claim tax-exempt under the new regime. The rules also report that an employee choosing the new regime cannot claim tax exemption on meal coupons allowance.
The tax-exempt allowances under the new regime are as below:
Also Read: Tax Query: Can I continue with my LIC policy under the new tax regime?
Also, an employee who is blind, or deaf and dumb, or orthopedically handicapped, with a disability of lower extremities can claim transport allowance, to meet expenditure on commuting between residence and the place of duty. The benefit is up to Rs 3,200 per month.
However, the tax rules withdraw the tax-exemption for meal coupons or paid vouchers under the new regime. Thus, an employee choosing the new tax regime cannot claim tax exemption for meal coupons or paid vouchers given by the employer.
For any clarifications/feedback on the topic, please contact the writer at sweta.dugar@cleartax.in
I am a Chartered Accountant by profession. I specialise in personal taxes and corporate income tax matters. I am an avid reader and track developments in financial markets, economy and other market developments.
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