Income Tax || Slab Rates for FY 2020-2021 (AY 2021-2022)
What is Income Tax?
An income tax is a tax that governments impose on income generated by businesses and individuals within their jurisdiction. By law, taxpayers must file an income tax return annually to determine their tax obligations. Income taxes are a source of revenue for governments. They are used to fund public services, pay government obligations, and provide goods for citizens. Certain investments, like housing authority bonds, tend to be exempt from income taxes.
Who is applicable to file which ITR in Income Tax?
Income Tax Slab Rates for FY 2020-2021 (AY 2021-2022)
The Finance Minister introduced new tax regime in Union Budget, 2020 wherein there is an option for individuals and HUF (Hindu Undivided Family) to pay taxes at lower rates without claiming deductions under various sections. The following Income Tax slab rates are notified in new tax regime :
Difference of slab rates between New tax regime vs Old Tax regime
- Please note that the tax rates in the New tax regime is the same for all categories of Individuals, i.e. Individuals & HUF upto 60 years of age, Senior citizens above 60 years upto 80 years , and Super senior citizens above 80 years. Hence no increased basic exemption limit benefit will be available to senior and super senior citizens in the New Tax regime. New tax regime slab rates are not differentiated based on age group. However, under old tax regime the basic income threshold exempt from tax for senior citizen (aged 60 to 80 years) and super senior citizens (aged above 80 years) is ₹ 3 lakh and ₹ 5 lakh respectively.
- Individuals with Net taxable income less than or equal to Rs 5 lakh will be eligible for tax rebate u/s 87A i.e. tax liability will be nil of such individual in both - New and old/existing tax regimes.
- Basic exemption limit for NRIs is of Rs 2.5 Lakh irrespective of age.
- Additional Health and Education cess at the rate of 4 % will be added to the income tax liability in all cases. (increased from 3% since FY 18-19).
- Surcharge applicable as per tax rates below in all categories mentioned above:
10% of Income tax if total income > Rs.50 lakh
15% of Income tax if total income > Rs.1 crore
25% of Income tax if total income > Rs.2 crore
37% of Income tax if total income > Rs.5 crore
Income tax slabs rate for Old Tax regime -FY 2020-2021
- Income tax slabs for Individual aged below 60 years & HUF
- Income tax slab for Individual aged above 60 years to 80 years
- Income tax slab for Individual aged more than 80 years
Difference of slab rates between New tax regime & Old Tax regime
New Tax regime Slab rates for domestic companies - FY 2020-2021.
Hope this helps.
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