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, individuals and HUF will have an option for computation of their 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 a 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 applies to all individual category which is given here-
| Income Tax slab | Income Tax Rate for All individuals- New Scheme |
|---|---|
| up to Rs. 250000 | NIL- No Tax |
| Rs. 250001 to Rs. 500000 | 5 % (Tax Rebate u/s 87a is available) |
| Rs. 500001 to Rs. 750000 | 10% |
| Rs. 750001 to Rs. 1000000 | 15% |
| Rs. 1000001 to Rs. 1250000 | 20% |
| Rs. 1250001 to Rs. 1500000 | 25% |
| Above Rs. 1500000 | 30% |
Note 1- 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 2:- A tax rebate under section 87A is allowed to individual taxpayers for a maximum amount of Rs. 12,500 if the total income is up to Rs. 5,00,000 for AY 2021-22. The amount of rebate shall be 100% of the Income Tax or Rs. 12,500 whichever is less. (New Regime)
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 Limit | Surcharge rate on the amount of Income Tax |
|---|---|
| Net income exceeds Rs. 50 Lakhs but does not exceed Rs. 1 Crore | 10% |
| Net Income exceeds Rs. 1 Crore but does not exceed Rs. 2 Crore | 15% |
| Net Income exceeds Rs. 2 Crore but does not exceed Rs. 5 Crore | 25% |
| Net Income exceeds Rs. 5 Crore | 37% |
Frequently Asked Questions- FAQs
-
What is the new Income Tax Slab For 2021 22?
Income Tax Slab For AY 2021-22 for individual New Tax Regime
🎯 up to Rs. 2,50,000 NIL ▶️ No Tax🎯 Rs. 2,50,001 to Rs. 5,00,000 ▶️ 5 % (Tax Rebate u/s 87a is available)
🎯 Rs. 5,00,001 to Rs. 7,50,000 ▶️ 10%
🎯 Rs. 7,50,001 to Rs. 10,00,000 ▶️ 15%
🎯 Rs. 10,00,001 to Rs. 12,50,000 ▶️ 20%
🎯 Rs. 12,50,001 to Rs. 15,00,000 ▶️ 25%
🎯 Above Rs. 15,00,000 ▶️ 30%
Note- 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 2:- A tax rebate under section 87A is allowed to individual taxpayers for a maximum amount of Rs. 12,500 if the total income is up to Rs. 5,00,000 for AY 2022-23. The amount of rebate shall be 100% of the Income Tax or Rs. 12,500 whichever is less. (New Regime)
-
What are the tax slabs for the assessment year 2021 22?
Income Tax Slab For AY 2021-22 for individual New Tax Regime
🎯 up to Rs. 2,50,000 NIL ▶️ No Tax🎯 Rs. 2,50,001 to Rs. 5,00,000 ▶️ 5 % (Tax Rebate u/s 87a is available)
🎯 Rs. 5,00,001 to Rs. 7,50,000 ▶️ 10%
🎯 Rs. 7,50,001 to Rs. 10,00,000 ▶️ 15%
🎯 Rs. 10,00,001 to Rs. 12,50,000 ▶️ 20%
🎯 Rs. 12,50,001 to Rs. 15,00,000 ▶️ 25%
🎯 Above Rs. 15,00,000 ▶️ 30%
Note- 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 2:- A tax rebate under section 87A is allowed to individual taxpayers for a maximum amount of Rs. 12,500 if the total income is up to Rs. 5,00,000 for AY 2022-23. The amount of rebate shall be 100% of the Income Tax or Rs. 12,500 whichever is less. (New Regime)
-
Does AY 2021/22 have a standard deduction?
Standard deduction means a flat deduction to individuals earning a salary or pension income. It was introduced back in Budget 2018 in lieu of transport allowance and reimbursement of miscellaneous medical expenses. It is allowable from the “Income taxable under the head salary” The tax benefits can be claimed irrespective of the actual amount spent on ‘transport allowance’ and ‘medical allowance’.
For the assessment year 2021-22, the standard deduction applicable to salaries individual and pensioners is Rs. 50,000/-. But if you are choosing to pay tax under the new tax regime then you can not avail of the standard deduction.
Must Read- How to Verify ITR- Know the 6 Ways to Verify your Income Tax Return
Join our Social Community
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 based on the above article.
Feedback/Suggestion- Hope you all find it useful, please give your valuable feedback & let us know if there is an error. Thanks in Advance
Compiled by- CA Chirag Agarwal (Practicing Chartered Accountants)