New Tax Regime- Income Tax Slab For AY 2021-22 for individual

In budget 2020, FM Smt. Nirmala Sitharaman has announced a new tax regime giving taxpayers an option to pay taxes as per the new tax slab from FY 2020-21 (AY 2021-22) onwards. In this post, we will discuss the Income Tax Slab For AY 2021-22 for individual New Tax Regime

Income Tax Slab For AY 2021-22

For AY 2021-22, Individual and HUF will have an option for computation of its income tax liability as per provision of section 115BAC and if they opt for this section, a new tax rate will be applicable and if they do not opt for section 115BAC, the existing tax rate will be applicable.

New Regime (Section 115BAC)- Here taxpayers can choose to pay tax at lower rates as per the new regime on the condition that they forgo certain permissible exemptions and deductions available under Income Tax, or

Old Regime (Existing Rate of Tax)- To continue to pay taxes under the existing tax rates. The assessee can avail of rebates and exemptions by staying in the old regime and paying tax at the higher rate.

Here you find the chart of Income Tax Slab For AY 2021-22 for individual New Tax Regime.

Also Read- Documents Required for ITR Filing- Income Tax Return Filing

Income Tax Slab For AY 2021-22 for Individual New Tax Regime

Under the new tax regime, the same chart is applicable to all individual category which is given here-

Income Tax slabIncome Tax Rate for All individuals- New Scheme
upto Rs. 250000NIL- No Tax
Rs. 250001 to Rs. 5000005 % (Tax Rebate u/s 87a is available)
Rs. 500001 to Rs. 75000010%
Rs. 750001 to Rs. 100000015%
Rs. 1000001 to Rs. 125000020%
Rs. 1250001 to Rs. 150000025%
Above Rs. 150000030%
Income Tax Slab For AY 2021-22 for individual New Tax Regime

The taxpayer opting for concessional rates in the New Tax Regime will have to forgo certain exemptions and deductions available in the existing old tax regime.

Note 1:- An additional 4% health & education cess will be applicable to the tax amount calculates as above.

Note 2:- A tax rebate under section 87A is allowed to individual taxpayers (Age 60 or 60 + but below 80 years) for a maximum amount of Rs. 10000 if the total income is up to Rs. 500000 for FY 2020-21.

Must Read- Standard Deduction for AY 2021-22 for Salaried Individuals.

Note 3:- The surcharge over the tax calculated will be charged (subject to marginal relief) as per the below table-

Income LimitSurcharge rate on amount of Income Tax
Net income exceed Rs. 50 Lakhs but does not exceed Rs. 1 Crore10%
Net Income exceed Rs. 1 Crore but does not exceed Rs. 2 Crore15%
Net Income exceed Rs. 2 Crore but does not exceed Rs. 5 Crore25%
Net Income exceed Rs. 5 Crore37%

Must Read- How to Verify ITR- Know the 6 Ways to Verify your Income Tax Return

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Disclaimer: The information contained in the above article are solely for informational purpose after exercising due care. However, it does not constitute professional advice or a formal recommendation. The author does not own any responsibility for any loss or damage caused to any person, directly or indirectly, for any action taken on the basis of the above article.

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Compiled by- CA Chirag Agarwal (Practicing Chartered Accountants)

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