INCOME TAX SLABS FY 2020-21 | TAX RATE IN INDIA | REVISED IT SLABS AY 2021-22
Indian Income tax on individuals and HUF is levied basis slab rate depending on the level of income. Indian Income is progressive in nature ie with increase in income, rate of tax payable increases, hence it means tax rate applicable for lower tax bracket is lower than average tax rate applicable for HNI (High net-worth individuals) INCOME TAX SLABS FY 2020-21
Table of Contents
Table of Contents
- Slabs for Individuals / HUF
- Categories of Income Tax on Individuals / HUF
- Old Tax Regime’ – Individuals who is less than 60 years of age (resident)/ non-resident individuals /HUF
- New Tax Regime’ – Individuals who is less than 60 years of age (resident)/ non-resident individuals / HUF
- CRITERIA FOR NEW TAX REGIME
- SWITCHING BETWEEN OLD AND NEW TAX REGIME
- Old Tax Regime’ – Resident senior citizens who is 60 years and above but below the age of 80 years
- New Tax Regime’ – Resident senior citizens who is 60 years and above but below the age of 80 years
- ‘Old Tax Regime’ – Resident super senior citizens who is above 80 years of age
- ‘New Tax Regime’ – Resident super senior citizens who is above 80 years of age
- Income Tax slab for Companies
- ‘Surcharge on Companies
- Income Tax slab for Firms
Slabs for Individuals/HUF
Categories of Income tax on individuals/HUF
There are 3 categories of rate applicable on income offered by individuals / HUF
- Individuals who is less than 60 years of age (resident), any non-resident individuals, every HUF / AOP/BOI/Artificial juridical person (Table – 1)
- Resident senior citizens who is 60 years and above but below the age of 80 years (Table – 2)
- Resident super senior citizens who is above 80 years of age (Table – 3)
Further, in budget 2020 announced a ‘New Tax Regime’ with lower tax rate but taxpayer has to forgo various exemptions / deductions. So, earlier system is referred as ‘Old Tax Regime’.
Old Tax Regime – Individuals who is less than 60 years of age (resident)/ non-resident individuals /HUF – (Table – 1 – Old Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 2,50,000/- | Nil |
| Rs 2,50,000/- to Rs 5,00,000/- | 5% on income exceeding Rs 2,50,000/- |
| Rs 5,00,001/- to Rs 10,00,000/- | Rs 12,500/- + 20% of total income exceeding Rs 5,00,000/- |
| Above Rs 10,00,000/- | Rs 1,12,500/- + 30% of total income exceeding Rs 10,00,000/- |
- Income below Rs 2,50,000/- is considered within exemption limit
- No tax on individuals upto Rs 5,00,000/- as per marginal relief under section 87A (FY 2020-21)
- Surcharge on income tax applicable if income exceeds Rs 50,00,000/-
- Health and education cess (‘HEC’) at 4% on income tax + surcharge (if surcharge is applicable)
New Tax Regime – Individuals who is less than 60 years of age (resident)/ non-resident individuals / HUF – (Table – 1 – New Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 2,50,000/- | Nil |
| Rs 2,50,000/- to Rs 5,00,000/- | 5% on income exceeding Rs 2,50,000/- |
| Rs 5,00,001/- to Rs 7,50,000/- | Rs 12,500/- + 10% of total income exceeding Rs 5,00,000/- |
| Rs 7,50,001/- to Rs 10,00,000/- | Rs 37,500/- + 15% of total income exceeding Rs 7,50,000/- |
| Rs 10,00,001/- to Rs 12,50,000/- | Rs 75,000/- + 20% of total income exceeding Rs 10,00,000/- |
| Rs 12,50,001/- to Rs 15,00,000/- | Rs 1,25,000/- + 25% of total income exceeding Rs 12,50,000/- |
| Rs 15,00,000/- and above | Rs 1,87,500/- + 30% of total income exceeding Rs 15,00,000/- |
- Income below Rs 2,50,000/- is considered within exemption limit
- No tax on individuals upto Rs 5,00,000/- as per marginal relief under section 87A (FY 2020-21)
- Surcharge on income tax applicable if income exceeds Rs 50,00,000/-
- Health and education cess (‘HEC’) at 4% on income tax + surcharge (if surcharge is applicable)
CRITERIA FOR NEW TAX REGIME
Taxpayer has to give up certain exemptions and deductions which is allowed under old tax regime as follows:-
- House Rent Allowances – HRA
- Leave Travel Allowances – LTA
- Standard Deduction (Rs 50,000/- for FY 2020-21)
- Professional tax
- Interest on housing loan (Section 24)
- Interhead adjustment of of Loss from House Property
- Chapter VI-A deductions like Rs 1.5 Lakhs under section 80C, Medical Insurance Premium under section 80D etc)
- Additional depreciation on Plant & machinery
- Deductions of payment for scientific research
- Deduction in respect of income from family pension
- Set off of brought forward losses pertaining to the specified allowance or unabsorbed depreciation on account of additional depreciation on plant and machinery
- Section 10AA exemptions for the unit in SEZ
- Deductions available under Section 35AD for specified businesses
SWITCHING BETWEEN OLD AND NEW TAX REGIME
- Individuals and HUF taxpayers without business income has opt either Old tax regime or New tax regime before due date of filing return of income. This option can be exercised every year
- Other taxpayers with business income can withdraw from the new tax regime option only once
Old Tax Regime – Resident senior citizens who is 60 years and above but below the age of 80 years (Table – 2 – Old Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 3,00,000/- | Nil |
| Rs 3,00,000/- to Rs 5,00,000/- | 5% on income exceeding Rs 3,00,000/- |
| Rs 5,00,001/- to Rs 10,00,000/- | Rs 10,000/- + 20% of total income exceeding Rs 5,00,000/- |
| Above Rs 10,00,000/- | Rs 1,10,000/- + 30% of total income exceeding Rs 10,00,000/- |
- Income below Rs 3,00,000/- is considered within exemption limit
- No tax on individuals upto Rs 5,00,000/- as per marginal relief under section 87A (FY 2020-21)
- Surcharge on income tax applicable if income exceeds Rs 50,00,000/
- Health and education cess (‘HEC’) at 4% on income tax + surcharge (if surcharge is applicable)
‘New Tax Regime’ – Resident senior citizens who is 60 years and above but below the age of 80 years (Table – 2 – New Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 3,00,000/- | Nil |
| Rs 3,00,000/- to Rs 5,00,000/- | 5% on income exceeding Rs 2,50,000/- |
| Rs 5,00,001/- to Rs 7,50,000/- | Rs 10,000/- + 10% of total income exceeding Rs 5,00,000/- |
| Rs 7,50,001/- to Rs 10,00,000/- | Rs 35,000/- + 15% of total income exceeding Rs 7,50,000/- |
| Rs 10,00,001/- to Rs 12,50,000/- | Rs 72,500/- + 20% of total income exceeding Rs 10,00,000/- |
| Rs 12,50,001/- to Rs 15,00,000/- | Rs 1,22,500/- + 25% of total income exceeding Rs 12,50,000/- |
| Rs 15,00,000/- and above | Rs 1,85,000/- + 30% of total income exceeding Rs 15,00,000/- |
CRITERIA FOR NEW TAX REGIME INCOME TAX SLABS FY 2020-21 | TAX RATE IN INDIA
Same criteria apply for new tax regime to all types of taxpayers
‘Old Tax Regime’ – Resident super senior citizens who is above 80 years of age (Table – 3 – Old Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 5,00,000/- | Nil |
| Rs 5,00,001/- to Rs 10,00,000/- | 20% of total income exceeding Rs 5,00,000/- |
| Above Rs 10,00,000/- | Rs 1,00,000/- + 30% of total income exceeding Rs 10,00,000/- |
- Income below Rs 5,00,000/- is considered within exemption limit
- Surcharge on income tax applicable if income exceeds Rs 50,00,000/
- Health and education cess (‘HEC’) at 4% on income tax + surcharge (if surcharge is applicable)
‘New Tax Regime’ – Resident super senior citizens who is above 80 years of age (Table – 3 – New Regime)
| Net Income Range | Income Tax Rates |
|---|---|
| Upto Rs 5,00,000/- | Nil |
| Rs 5,00,001/- to Rs 7,50,000/- | 10% of total income exceeding Rs 5,00,000/- |
| Rs 7,50,001/- to Rs 10,00,000/- | Rs 25,000/- + 15% of total income exceeding Rs 7,50,000/- |
| Rs 10,00,001/- to Rs 12,50,000/- | Rs 62,500/- + 20% of total income exceeding Rs 10,00,000/- |
| Rs 12,50,001/- to Rs 15,00,000/- | Rs 1,12,500/- + 25% of total income exceeding Rs 12,50,000/- |
| Rs 15,00,000/- and above | Rs 1,75,000/- + 30% of total income exceeding Rs 15,00,000/- |
CRITERIA FOR NEW TAX REGIME INCOME TAX SLABS FY 2020-21 | TAX RATE IN INDIA
Same criteria apply for new tax regime to all types of taxpayers
Surcharge for individuals (Table 1, 2,3) – Both new & old tax regime
The following surcharge slab is applicable for individuals (all types):
- Surcharge is applicable on Income Tax payable
- Surcharge is subject to marginal relief
| Net Income Range – Individuals / HUF | Surcharge Rates |
|---|---|
| Net Income range from Rs 50 Lakhs to Rs 1 Crore | 10% of income tax |
| Net Income range above Rs 1 Crore to till Rs 2 Crores | 15% of income tax |
| Net Income range above Rs 2 Crores to till Rs 5 Crores | 25% of income tax |
| Net Income exceeds Rs 5 Crores | 37% of income tax |
Health and education cess (‘HEC’) on Individuals/HUF
- Health and education cess (‘HEC’) on Individuals/HUF is 4% on income-tax and surcharge
Income Tax slab for Companies (Table-4-Income Tax)
The following income tax slab for companies:
| Company | Tax Rates |
|---|---|
| Domestic Company Total turnover / gross receipts during the previous year 2019-20 does not exceed Rs 400 Crores | 25% |
| Domestic Company Total turnover / gross receipts during the previous year 2019-20 exceeding Rs 400 Crores | 30% |
| Foreign Company Royalty received or fees for technical services from Government | 50% |
| Foreign Company Other income (other than above) | 40% |
Surcharge for Companies (Table-4-Surcharge)
Surcharge levied on companies is applicable on income tax
| Net Income Range – Company | Tax Rates |
|---|---|
| Domestic Company Net Income in the range of 1 Crore to 10 Crores | 7% |
| Domestic Company Net Income exceeds Rs 10 Crores | 12% |
| Foreign Company Net Income in the range of 1 Crore to 10 Crores | 2% |
| Foreign Company Net Income exceeds Rs 10 Crores | 5% |
Health and education cess (‘HEC’) on Companies INCOME TAX SLABS FY 2020-21
- Health and education cess (‘HEC’) on Companies is 4% on income-tax and surcharge.
Income Tax slab for Firms (Table-5-Income Tax)
- Income Tax Rate for Firm is 30% on net income
- Surcharge: Surcharge applies if net income exceeds Rs 1 Crore and Surcharge is 12% of the Income Tax
- Health & Education Cess: 4% of Income Tax and Surcharge
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