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ITR Slabs

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Introduction

We all know that in India the income tax is levied on all the individual who are counted as the taxpayers. The tax is divided in different slabs slab system, under which different tax rates have been advised for different slabs. This tax slab order is prescribed in decreasing order which keeps on increasing with an increase in the income slab.

Terms to know

  1. Income Tax -
    The Tax which is imposed by the government on the income generated by businesses and individuals within one financial year termed as income tax. As the income of the business entity or the individual increases the amount of tax is also does. This contribution to the government, is the amount which is utilised by government for the betterment of the society. The income can be-

Income Tax Slab -

  1. The income tax slabs describes about the bracket under which the percentage of the tax amount to be paid is mentioned. The tax slabs increases with the increase in the income. As per this slab income is categorized into different groups and criteria under a tax regime, these groups of income tax are termed as Income Tax Slab. Income Tax slab and rate is dependent on -
  • Total Income
  • Residential Status 
  • Type of taxpayer and age
    Tax Regime -
  1. Tax Regime is the set of regulations according to which all the individuals and the business entities has to submit their amount to tax and the penalties if applicable to the government. As per this tax regime the taxpayers are divided as -
  • Individuals below the age of 60 years
  • Resident senior citizens between 60 years and below 80 years
  • Resident super senior citizens who are above 80 years

Existing tax regime:-

Income Tax Slab

Tax Rate

Up to INR 2.5 lakh

NIL

INR 2.5 lakh to INR 5 lakh

5% (Tax rebate of INR 12,500 available under section 87A)

INR 5 lakh to INR 7.5 lakh

10%

INR 7.5 lakh to INR 10 lakh

15%

INR 10 lakh to INR 12.5 lakh

20%

INR 12.5 lakh to INR 15 lakh

25%

Above INR15 lakh

30%

  1. Financial Year (FY)-
    It the year in which a tax-payer has earned the income and paid tax over it. Its starts from 1st April and ends on 31st March.
    Assessment year (AY)-
  2. It is the year which is next year of the present financial year for which you have filled your income tax return. It comes after the financial year. In the assessment year the income earned during the financial year is assessed and taxed. Both the Financial Year and Assessment Year if calculated from 1st April to 31st March. For e.g. for financial year 2018-2019, the assessment year will be 2019-2020. For instance one says that the FY 2019-20 and AY 2020-21, is the same thing.

Income Tax Slabs for all Individuals

  1. Income tax slabs for resident individual below 60 years of age -

Taxable income slabs

Income tax rates and cess

Up to INR 2.5 lakh

Nil

INR 2,50,001 to INR 5,00,000

5% of Total income minus INR 2,50,000 + 4% cess

INR 5,00,001 to INR 10,00,000

 

INR 12,500 + 20% of Total income minus INR 5,00,000 + 4% cess

Above INR 10,00,001

INR 1,12,500 + 30% of Total income minus INR 10,00,000 + 4% cess

  1. Income tax slabs for Senior Citizen

Taxable income slabs

Income tax rates and cess

Up to INR 3 lakh

Nil

INR 3,00,001 to INR 5,00,000

5% of Total income minus INR 3,00,000 + 4% cess

INR 5,00,001 to INR 10,00,000

INR 10,000 + 20% of Total income minus INR 5,00,000 + 4% cess

Above INR 10,00,001

INR 1,10,000 + 30% of Total income minus INR 10,00,000 + 4% cess

  1. Income tax slabs for Super Senior Citizen

Taxable income slabs

Income tax rates and cess

Up to INR 5 lakh

Nil

INR 5,00,001 to INR 10,00,000

20% of (Total income minus INR 5,00,000) + 4% cess

Above INR 10,00,001

INR 1,00,000 + 30% of (Total income minus INR 10,00,000) + 4% cess

List deductions and exemptions -

  • LTA (Leave Travel Allowance) 
  • HRA (House Rent Allowance) 
  • Conveyance and Daily expenses
  • Relocation and helper allowance
  • Children education allowance
  • Other special allowances [refer Section 10(14) Income Tax Act)]
  • Professional Tax
  • Interest on housing loan (Section 24 of Income Tax Act)
  • Chapter VI-A deduction covered under sections - 80C,80D, 80E etc. of Income Tax Act (Except Section 80CCD(2) and 80JJA)

Income Tax Slabs HUF

Income Tax Slab

Tax Rate for HUF

Up to INR 2,50,000

Nil

INR 2,50,001 to INR 5,00,000

5% of total income exceeding INR 2,50,000

INR 5,00,001 to INR 10,00,000

INR 12,500 + 20% of total income exceeding INR 5,00,000

Above INR 10,00,000

INR 1,12,500 + 30% of total income exceeding INR 10,00,000

As per section 87A, the tax rebate is –

  • FY 2018-19 income up to 3.5 lac, rebate amount - 2,500
  • FY 2019-20 in come up to 5 lac, rebate amount - 12,500

Income Tax Slab for Indian Companies

Turnover Tax Rate

Tax Rate

FY 2017-18 - turnover up to 400 Cr

25% + CESS; 4% of corporate Tax

FY 2017-18 - turnover exceeding 400 Cr

30% + CESS; 4% of corporate Tax

If in case company has opted for Section 115BA

25% + CESS; 4% of corporate Tax

If in case company has opted for Section 115BAA

22% + CESS; 4% of corporate Tax

If in case the company has opted for Section 115BAB

15% + CESS; 4% of corporate Tax

Surcharge are applicable as –

  • If in case the net income exceeds INR 1 Crore but doesn’t exceed INR 10 Crore, then the surcharge will be 7%
  • If in case the net income exceeds INR 10 Crore, then the surcharge will be 12%

Income Tax Slabs for NRI (Non – Resident Individuals)

Income Tax Slabs

Tax Rate for Super Senior Citizens (Aged 80 Years And Above)

Income up to INR 2,50,000*

No tax

Income INR 5,00,001 to 7,50,000

10% + 4% Cess + Surcharge

Income INR 7,50,001 to 10,00,000

15% + 4% Cess + Surcharge

Income INR 10,00,000 to 12,50,000

20% + 4% Cess + Surcharge

Income INR  12,50,00 to 15,00,000

25%

 

Income Tax Slab for Co-operative Society

  • Tax imposed will be at 25% + 4% + Surcharge – in case the turnover or gross receipt is up to 400 Crore.
  • Tax Imposed will be at 30% + 4% + Surcharge - in case the turnover or gross receipt is more than 400 crores.

Income Tax Slab for Foreign Company

  • The Tax rate imposed will be at 50% + 4% cess + Surcharge in case the royalty has been received from the government

Experts call

Income is one of the vital part of business lifeline. With the introduction of Union Budget, it tends to get change in every new financial year. These changes are done to support business holders so that they can get maximum rebate on the taxes. It’s really important to be updated with the new norms of the slabs and exemptions. Income Tax played an important role in the revenue generation of the government as about 71% of total government revenue is collected through the Tax. In the end of the every financial year we have to file the income tax, failing so can lead to the penalties. For further inquiry, feel free to contact Corpseed.

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Author
Shamshad Alam
Experienced Digital Marketer with a demonstrated history of working in the internet industry. He likes to write about the latest technology trends, Skilled in Digital Marketing likes. Search Engine Optimization, SMO, SEM, PPC, Content Writing, and, Designing, etc.