Income Tax Slabs & Rates 2020-2021
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 vs old tax regime:
|Income Tax Slab||Tax rates as per new regime||Tax rates as per old regime|
|₹0 - ₹2,50,000||Nil||Nil|
|₹2,50,001 - ₹ 5,00,000||5%||5%|
|₹5,00,001 - ₹ 7,50,000||₹12500 + 10% of total income exceeding ₹5,00,000||₹12500 + 20% of total income exceeding ₹5,00,000|
|₹7,50,001 - ₹ 10,00,000||₹37500 + 15% of total income exceeding ₹7,50,000||₹62500 + 20% of total income exceeding ₹7,50,000|
|₹10,00,001 - ₹12,50,000||₹75000 + 20% of total income exceeding ₹10,00,000||₹112500 + 30% of total income exceeding ₹10,00,000|
|₹12,50,001 - ₹15,00,000||₹125000 + 25% of total income exceeding ₹12,50,000||₹187500 + 30% of total income exceeding ₹12,50,000|
|Above ₹ 15,00,000||₹187500 + 30% of total income exceeding ₹15,00,000||₹262500 + 30% of total income exceeding ₹15,00,000|
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.
However, under new tax regime person cannot claim up to 70 income tax deductions while calculating taxes. Hence, every person has to make his/her own calculation as per old and new tax regime and calculate which one is beneficial based on type of investments made and returns earned on those investments.
Consider an example, a person aged 35 years has the total income of ₹11, 00,000 and has made the investment under section 80C of ₹1, 50,000 and under Section 80CCD of ₹50,000. He has claimed income tax deduction with medical and Leave travel allowance of ₹50000 and HRA of ₹1,50,000 The tax payable under new and old tax regime is as follows:
|Particulars||New regime||Old regime|
|Gross total income||₹ 11,00,000||₹ 11,00,000|
|Less: Deductions under 80C||₹ 0||₹ 1,50,000|
|Less: Standard Deduction (Medical & Travel Allowance)||₹ 0||₹ 50,000|
|Less: Deductions under 80CCD||₹ 0||₹ 50,000|
|Less : HRA deduction as per section 10(13A)||₹ 0||₹ 1,50,000|
|Taxable Income||₹ 11,00,000||₹ 7,00,000|
|Taxes payable as per slab rates|
|₹0 - ₹2,50,000||₹ 0||₹ 0|
|₹2,50,001 - ₹ 5,00,000||₹ 12,500||₹ 12,500|
|₹5,00,001 - ₹ 7,50,000||₹ 25,000||₹ 40,000|
|₹7,50,001 - ₹ 10,00,000||₹ 37,500||₹ 0|
|₹10,00,001 - ₹12,50,000||₹ 20,000||₹ 0|
|Total taxes||₹ 95,000||₹ 52,500|
Income Tax Slabs and Rates for Financial Year: 2019-20
|Income Tax Slab||Individuals below the age of 60 years|
|Up to `2,50,000||Nil|
|2,50,001 to 5,00,000||5%|
|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|
|Income Tax Slab||Senior Citizens (aged 60 years but less than 80 years)|
|Up to 3,00,000||Nil|
|3,00,001 to 5,00,000||5%|
|5,00,001 to 10,00,000||10,000 + 20% of total income exceeding 5,00,000|
|Above 10,00,000||1,10,000 + 30% of total income exceeding 10,00,000|
|Income Tax Slab||Very Senior Citizens (aged 80 years and above)|
|Up to 5,00,000||Nil|
|5,00,001 to 10,00,000||20%|
|Above 10,00,000||1,00,000 + 30% of total income exceeding 10,00,000|
Above rates does not include Surcharge and Cess.
- 10% surcharge is applicable on income tax if income exceeds 50 lacs but upto 1 crore
- 15% surcharge is applicable on income tax if income exceeds 1 crore
- 4% Health & Education Cess is applicable on the income tax and applicable surcharge.
Tax rates and slabs are same for Male and Female as per above table
Individuals having total income below 5 lakhs, are eligible for full tax rebate under section 87A
|Less: Standard Deduction (Medical & Travel Allowance)||50,000||50,000||50,000|
|Less : Deduction u/s 80C||80,000||1,50,000||1,50,000|
|Less : HRA deduction as per section 10(13A)||92,000||1,00,000||1,50,000|
|Gross Taxable Income (GTI)||2,78,000||7,00,000||11,50,000|
|Tax computation on GTI|
|Up to 2,50,000||-||-||-|
|2,50,001 to 5,00,000||1,400||12,500||12,500|
|B||Less Rebate u/s 87A||1,400||-||-|
|C||Add: Health & Education Cess @ 4% on (A-B)||-||2,100||6,300|
|Tax Payable (A-B+C)||-||54,600||1,63,800|
Income Tax Slabs and Rates proposed for Financial year 2019-20
As per interim budget 2019, Individual taxpayers having taxable annual income up to Rs.5 lakh will get full tax rebate u/s 87A and therefore will not be required to pay any income tax. However Income tax Slabs and Rates will remain unchanged for the FY2019-20.
✅ Is the due date for filing tax return same for all taxpayers?
✅ What is the time period considered for the purposes of income tax?
✅ Who decides the IT slab rates and can they change?
✅ Do I need to file Income Tax Return (ITR) if my annual income is below ₹ 2.5 lakh?
✅ Are there separate slab rates for males and females?
✅ Are there separate slab rates for different age groups?
✅ Will my income be taxed if I am an agriculturist?
People like you also read...
∞This is only a provisional certificate and this does not communicate acceptance or commencement of risk under proposal submitted by you. This document may be used as a proof for claiming deductions while filing your tax returns subject to provisions of relevant tax sections and acceptance of risk, i.e. on policy issuance by the company. For any confirmation / impact analysis customer is advised to refer the matter to his Tax consultant.
^ Tax benefit of ₹ 54,600 (₹ 46,800 u/s 80C & ₹ 7,800 u/s 80D) is calculated at highest tax slab rate of 31.2% (including Cess excluding surcharge) on life insurance premium u/s 80C of ₹ 1,50,000 and health premium u/s 80D of ₹ 25,000. Tax benefits under the policy are subject to conditions under Section 80C, 80D, 10(10D) and other provisions of the Income Tax Act, 1961. Goods and Services Tax and Cesses, if any, will be charged extra as per prevailing rates. Tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details, before acting on above.
Tax benefits under the policy are subject to conditions under Section 80C, 80D, 10(10D) and other provisions of the Income Tax Act, 1961. Goods and Services Tax and Cesses, if any, will be charged extra as per prevailing rates. Tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details, before acting on above.
Unlike traditional products, Unit Linked insurance products are subject to market risk, which affect the Net Asset Values & the customer shall be responsible for his/her decision. The names of the Company, Product names or fund options do not indicate their quality or future guidance on returns. Funds do not offer guaranteed or assured returns.
Please note that the tax write-up above is for general understanding and reference. The reader will have to verify the facts, law and content with the prevailing tax statutes and seek appropriate professional advice before acting on the basis of the above information. Tax benefits/savings are subject to conditions of Section 80C, 80CCC, 80CCE, 10(10A), 10(10D) and other provisions of the Income Tax Act, 1961. Tax laws are subject to amendments from time to time. ICICI Prudential Life Insurance Company Limited expressly disclaims any liability to any person, if tax benefits stated above are denied to the customer
Tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details, before acting on above.
ADVT No - W/II/3266/2018-19