Income Tax Slabs and Rates in India
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The direct taxes levied on an individual's income is called Direct Tax. Direct tax is deducted directly from the income of an individual but indirect are levied on consumers when they purchase goods or services. The different forms of direct taxes collected from people are wealth tax, inheritance tax, corporate tax etc. These taxes are used later for the improvement of infrastructure, healthcare, education, defense and other purposes. A huge chunk of the development in a country is funded from the direct tax collected from people. Direct taxes are considered to be one of the most stable sources of credit for the government. The direct tax collected from people are also used to pay the income to government employees
How to Calculate Income Tax
The calculation of Income Tax depends on many factors. Some of the important factors that affect the calculation of Income Tax are the amount of income earned, the source of income and the age of the earning person. To calculate the amount of income tax levied on an individual, they are required to declare their total earnings and the total deductions for the assessment year. ALong with the earnings and deductions, the individual is also required to file exemptions from the taxes as well. A person can claim medical, educational, HRA exemption etc. There are certain investments that attract exemptions from the government. If the taxpayer intimates the Income Tax Department regarding these investments, then they can avail tax exemptions.
Normal tax rates applicable to a resident individual below the age of 60 years i.e. born on or after 1.4.1958
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,50,000) [*] |
4% of income tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income tax |
Normal tax rates applicable to a resident individual of the age of 60 years or above at any time during the year but below the age of 80 years
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 3,00,000 |
Nil |
Nil |
|
Rs. 3,00,000 – Rs. 5,00,000 |
5% of (total income minus Rs.3,00,000) [*] |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 10,000 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,10,000 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to a resident individual of the age of 80 years or above at any time during the year
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 5,00,000 |
Nil |
Nil |
|
Rs. 5,00,000 – Rs. 10,00,000 |
20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,00,000 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Non-resident individual irrespective of age
|
Net income range |
Income-tax rates |
Health and Education Cess |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,00,000) [*] |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rate applicable to resident/non-resident Hindu Undivided Family (HUF)
|
Net income range |
Income-tax rates |
Health and Education |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs.2,50,000) |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to every AOP/BOI/Artificial juridical person
|
Net income range |
Income-tax rates |
Health and Education |
|
Up to Rs. 2,50,000 |
Nil |
Nil |
|
Rs. 2,50,000 – Rs. 5,00,000 |
5% of (total income minus Rs. 2,50,000) |
4% of income-tax |
|
Rs. 5,00,000 – Rs. 10,00,000 |
Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) |
4% of income-tax |
|
Above Rs. 10,00,000 |
Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) |
4% of income-tax |
Normal tax rates applicable to a Co-operative societies
|
Net income range |
Rate of income-tax |
|
Up to Rs. 10,000 |
10% |
|
Rs. 10,000 - Rs. 20,000 |
20% |
|
Above Rs. 20,000 |
30% |
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