How do I tell my employer which regime I want?

CA Vijay R Singh, FCA
Chartered Accountant · ICAI M.No. 153926 · FRN 136869W

Short answerAt the start of the financial year, your employer asks you to declare your old or new regime choice, so they deduct the right monthly TDS. If you don’t choose, the new regime applies by default. You can still switch when you actually file your return, regardless of what you told your employer.

The start-of-year declaration

Employers collect your regime choice (and proposed investments, for the old regime) early in the year, so the monthly TDS matches your likely tax. Declaring accurately avoids large over- or under-deduction across the year.

Default and the right to switch

If you make no declaration, the employer applies the new regime by default. Importantly, the choice you give your employer is only for TDS convenience — you can still pick the other regime when you file your return, as long as you have no business income (business owners face restrictions on switching). Confirm the switching rules for your situation.

A worked example

Example: you tell your employer ‘new regime’ for simplicity, so TDS is deducted accordingly. At year-end you realise your home loan and 80C make the old regime better — you simply choose it in your return and claim the larger refund. The employer declaration didn’t lock you in. Our team can confirm which regime to file under.

Income Tax

← Back to all questions

Talk to CA Vijay R Singh

Unsure what to declare to your employer? You can message him directly, or book a short call to talk through your situation.

Book a 15-minute call
Message on WhatsApp
Email your query

This answer is general information for taxpayers, not tax advice. Tax rates, thresholds and forms change with each Finance Act — please confirm the current position for your own facts, or speak to us, before acting.