1. For resident Senior Citizens. (Age above 60 Years)
2. For resident Super Senior Citizens. (Age above 80 Years)
3. Individuals, [other than those mentioned above, HUF, AOP/BOI (other than co-operative societies).
Note: Rebate u/s 87A, in which resident individuals are allowed rebate (if their taxable income does not exceed Rs. 5 lakh) equal to 100% of income tax or Rs. 12,500 whichever less.
Health and Education Cess: 4% on the amount of Tax plus surcharge
Health and Education Cess: 4% on the amount of Tax plus surcharge.
Companies
Surcharge : 12% of the Income Tax, where total taxable income is more than Rs. 1 crore.
Income tax : Flat rate of 22%
Surcharge : 10% of the Income Tax
Income tax : 30%.
Surcharge : 12% of the Income Tax, where total taxable income is more than Rs. 1 crore
The tax calculated on the basis of such rates will be subject to health and education cess of 4%.
Any individual opting to be taxed under the new tax regime from FY 2020-21 onwards will have to give up certain exemptions and deductions.
Here is the list of exemptions and deductions that a taxpayer will have to give up while choosing the new tax regime.
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)
Points to remember while opting for the new tax regime:
Option to be exercised on or before the due date of filing return of income for AY 2021-22
In case a taxpayer has a business income and exercised the option, he/she can withdraw from the option only once. A business taxpayer withdrawing from the optional tax regime has to follow the regular income tax slabs.
According to the current income tax laws in India, the income tax rate on resident individuals varies based on their age. There are different tax slabs applicable to the individuals for the financial year 2018-19 and 2019-20. For instance, a resident individual, aged below 60 years, with an income less than Rs 2.5 lacs is exempt from paying income tax.
No tax for individuals with income less than ? 2,50,000
0%-5% tax with income ? 2.5 lacs to 5 lacs for different age groups
20% tax with income ? 5 lacs to 10 lacs
30% tax with income above ? 10 lacs
A tax rebate under section 87A is allowed to individual taxpayers a maximum amount of:
– Rs 2,500 for total income up to Rs 3.5 lakh for FY 2018-19
– Rs 12,500 for total income up to Rs 5 lakh for FY 2019-20
Investments upto ? 1.5 lacs under Sec 80C can save ? 46,800 in taxes.
Note : An additional 4% Health & education cess will be applicable on the tax amount calculated as above.
Let’s understand the tax calculation for rebate with the help of an example:
Let’s understand the tax calculation for a rebate with the help of an example:
In addition cess and surcharge is levied as follows:
Cess: 4% of corporate tax
Surcharge applicable:
However, the rate of surcharge in case of a company opting for taxability under Section 115BAA or Section 115BAB shall be 10% irrespective of amount of total income.
Note: An additional 4% Health & education cess will be applicable on the tax amount calculated as above.
Surcharge applicable to the individuals covered in Part I, II and III:
In addition cess and surcharge is levied as follows: Cess: 4% of corporate tax
Please send us your query and we'll be happy to assist you