In India, income is calculated on the basis of different parameters like in case of individual assessee income is calculated on the basis of his age group and for other personal income is calculated as per their status under Income Tax Act. In this post, we will discuss the 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. Here in this post, we will discuss both regimes of Income Tax for individuals.
Income Tax Slab For AY 2021-22
As per the budget 2020, under the new regime, the taxpayer has an option to choose either a new regime or stay in the old regime.
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 as per both new and old regimes.
Income Tax Slab For AY 2021-22 For Individual as per new regime
Under the new regime the same chart is applicable to all individual category which is given here-
|Income Tax slab||Income Tax Rate for All individuals- New Scheme|
|upto 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- 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.
Income Tax Slab For AY 2021-22 For Individual as per old regime
An Individual can opt to pay tax as per the old regime, where he needs to follow the existing tax slab which is as follow-
|Income Tax slab||Income Tax rate for individual (Age below 60 years) & HUF|
|upto Rs. 250000||NIL- No Tax|
|Rs. 250000 to Rs. 500000||5 % of total income exceeding Rs. 250000|
|Rs. 500001 to Rs. 1000000||Rs. 12500 + 20% of total income exceeding Rs. 500000|
|Above Rs. 1000000||Rs. 112500 + 30% of total income exceeding Rs. 1000000|
The following are applicable to both regime of Tax.
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.
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 amount of Income Tax|
|Net income exceed Rs. 50 Lakhs but does not exceed Rs. 1 Crore||10%|
|Net Income exceed Rs. 1 Crore but does not exceed Rs. 2 Crore||15%|
|Net Income exceed Rs. 2 Crore but does not exceed Rs. 5 Crore||25%|
|Net Income exceed Rs. 5 Crore||37%|
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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)