Revised Income Tax Slabs & Tax Rates in India for FY 2020-21 (AY 2021-22) & FY 2019-20 (AY 2020-21)

Revised Income Tax Slabs & Tax Rates in India for FY 2020-21 (AY 2021-22) & FY 201920 (AY 2020-21) Indian income tax department collects taxes from individuals & businesses based on their incomes. Higher the income, higher the taxes. However, due to wide disparity in the sources of income and the economic condition of the tax-payers, the tax rates have been divided into multiple slabs every tax-payer has to bear a justified burden of taxes. These tax rates are prone to changes every year on the announcement on the new budget.

Further, the new tax regime introduced in the Budget 2020 has given an option to the taxpayers to pay taxes as per the new tax slabs from FY 2020-21 onwards.

Following are the different slabs for each category of taxpayers for FY 2020-21 (AY 202122) & FY 2019-20 (AY 2020-21).

Part 1: Income tax slabs under the New Tax Regime for all individuals for FY 2020-21 (AY 2021-22): Income Tax Slab

Tax Rate

Up to Rs 2.5 lakh

NIL

Rs 2.5 lakh to Rs 5 lakh

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

Rs 5 lakh to Rs 7.5 lakh

10%

Rs 7.5 lakh to Rs 10 lakh

15%

Rs 10 lakh to Rs 12.5 lakh

20%

Rs 12.5 lakh to Rs 15 lakh

25%

Rs 15 lakh and above

30%

Note: Health and Education Cess: In addition to the tax calculated above, the tax-payer will also have to pay health and education cess of 4%, calculated on the amount of tax.

Points to remember while choosing the new tax regime: • If any individual opts to be taxed under the new tax regime from FY 2020-21 onwards, then he or she will have to give up certain exemptions and deductions including: • Leave Travel Allowance (LTA) • House Rent Allowance (HRA) • Conveyance

• • • • • • • • •

Daily expenses in the course of employment Relocation allowance Helper allowance Children education allowance Other special allowances [Section 10(14)] Standard deduction Professional tax Interest on housing loan (Section 24) Chapter VI-A deduction (80C, 80D, 80E and so on) (Except Section 80CCD (2) and 80JJA) • The option for opting new scheme can only be exercised if the return is filed on or before the due date of filing the return of income.

• If a taxpayer who has a business income and has opted for the new regime, then he or she can withdraw from the option for only once. After withdrawing, the business taxpayer will have to follow the regular income tax slabs.

However, if the individual does not want to choose the ‘New Tax Regime 2020’ option, he or she can continue to pay taxes as per the existing tax slabs.

Part 2: As per the existing tax regime, there are three categories of individual taxpayers: • Resident and Non-Resident Individuals below the age of 60 years • Senior citizens or Resident Individuals above 60 years but below 80 years of age • Super senior citizens or Resident above 80 years of age Income Tax Slabs & Rates for Individual Tax Payers & HUF (Less Than 60 Years Old) FY 2019-20 – Part I Income Tax Slab

Tax Rate for Individual & HUF Below the Age Of 60 Years

Up to ₹2,50,000*

Nil

₹2,50,001 to ₹5,00,000

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

₹5,00,001 to ₹10,00,000

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

Above ₹10,00,000

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

•

The taxpayer also has to pay an additional 4% Health & education cess along with the tax calculated as per the aforementioned rates. (4% of the total tax amount).

• If the taxpayer has an income only up to Rs. 5 Lakh annually for F.Y. 2019-20, then he or she would get a tax rebate of Rs. 12,500 under section 87A • Also, the taxpayer can avail a deduction of up to Rs. 1.5 Lacs under sec 80 for making prescribed investments. This can help taxpayers in saving up to Rs. 46800/Income Tax Slabs for Senior Citizens (60 Years Old Or More but Less than 80 Years Old) FY 2019-20 – Part II Income Tax Slab

Tax Rate for Individual & HUF Below the Age Of

Income up to Rs 3,00,000*

No tax

Income from Rs 3,00,000 – Rs 5,00,000

5%

Income from Rs 5,00,000 – 10,00,000

20%

Income more than Rs 10,00,000

30%

Income Tax Slabs for Super Senior Citizens (80 Years Old Or More) FY 2019-20 – Part III Income Tax Slab

Tax Rate for Super Senior Citizens (Aged 80 Years An

Income up to Rs 5,00,000*

No tax

Income from Rs 5,00,000 – 10,00,000

20%

Income more than Rs 10,00,000

30%

Note: In both Senior and Super Senior Citizen based slabs, an additional 4% Health & education cess will be payable along with the tax.

To know more information please visit website:- https://filingbuddy.in/income-tax-slabs/