International Journal of Scientific Research in Engineering and Management (IJSREM) Volume: 09 Issue: 02 | Feb - 2025 SJIF Rating: 8.448 ISSN: 2582-3930 © 2025, IJSREM | www.ijsrem.com DOI: 10.55041/IJSREM41536 | Page 1 A Study of Investor’s Behavior Towards Income Tax Planning under New and Old Tax Regime: Case Study Approach Dr. Madhura Deshpande #1 Ms. Akanksha Rakshe *2 1 madhura.deshpande07@gmail.com 2 akansharakshe@gmail.com *1 Asst Prof. International Institute of Management Science, Pune, India *2 Student. International Institute of Management Science, Pune, India Abstract Tax planning is an essential aspect of financial management, enabling individuals to optimize their tax liabilities while adhering to legal frameworks. This study examines investor behavior towards income tax planning, exploring the factors influencing their decisions, awareness levels, and preferred tax- saving instruments. Using a mixed-method approach, primary data was collected through surveys and interviews with investors across different income groups. The research highlights the role of financial literacy, risk perception, and tax-saving preferences in shaping tax planning strategies. Findings suggest that while some investors actively engage in tax planning to maximize benefits, others lack awareness or rely on traditional methods. The study provides insights into behavioral patterns and policy implications, emphasizing the need for financial education and advisory support to enhance tax efficiency. Keywords: Investor behavior, Income tax planning, Financial literacy, Tax-saving instruments, Financial management. Introduction to Concept of Tax: Taxation is the essential power of the state to put and demand donation upon Persons, parcels, or right for the purpose of generating earnings for public purposes. Levies are executed commensurable benefactions from Persons to property levied by the law- making body of the state by virtue of its sovereignty for the support of the government and all public requirements. Taxation System: Tax system for generating revenue to support the Government. Each government necessitates the collection of monetary taxes from its citizens. The government utilizes revenues to compensate soldiers and police, construct dams and roads, operate schools and hospitals, supply food to the needy, and offer medical care facilities, among other functions. Without taxes to support its operations, the government would cease to exist. Hence, taxation is the primary source of revenue for contemporary government, usually accounting for 90% or greater of their income. Essentials Characteristics of Tax: • It is a mandatory Contribution. • It was allotted in character, typically depending on capability to pay. • It is imposed on individuals and assets within the state's jurisdiction. • It is imposed for the benefit of the public. • It is typically necessary to receive payment at consistent intervals. Why Are Taxes Levied? The purpose of imposing taxes is that they serve as the fundamental source of income for the government. The revenue generated is used to cover government expenses such as defense, education, healthcare, and infrastructure facilities including roads, dams, and more. What Are the Reasons of Taxation? • Offer essential services for each citizen of the nation. • Fund various initiatives and programs by the government. • Safeguarding of Existence. • Duty of a citizen to the Nation. Meaning Of Tax: The term Tax originates from the Latin word "Taxon, Tax are," signifying the act of assessing or estimating. Different Types of Taxes: Figure 1.1