In India, income is calculated on the basis of different parameters like in the case of an individual assessee’s income is calculated on the basis of his age group and 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 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 a higher rate.
Here you find the chart of Income Tax Slab for AY 2021-22 For Individual as per both new and old regimes.
Must Read- Standard Deduction for AY 2021-22 for Salaried Individuals.
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 |
|---|---|
| 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- 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.
Also Read- AY 2021-22: Section 44AD of Income Tax Act- Presumptive Scheme
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 |
|---|---|
| up to 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 |
Also Read- Income Tax Slab For AY 2021-22 For Senior Citizens as per old and new regime.
Income Tax rates for Senior Citizen (Age 60 years to 80 years)
| Income Tax Slab | Income Tax Rates – Senior Citizen |
|---|---|
| upto Rs. 3,00,000 | NIL- No Tax |
| Rs. 3,00,000 to Rs. 5,00,000 | 5 % of total income exceeding Rs. 3,00,000 |
| Rs. 5,00,001 to Rs. 10,00,000 | Rs. 10,000 + 20% of total income exceeding Rs. 5,00,000 |
| Above Rs. 10,00,000 | Rs. 1,10,000 + 30% of total income exceeding Rs. 10,00,000 |
Income Tax rates for Super Senior Citizen (Age above 80 years of age)
| Income Tax Slab | Income Tax Rates – Super Senior Citizen |
|---|---|
| upto Rs. 5,00,000 | NIL- No Tax |
| Rs. 5,00,001 to Rs. 10,00,000 | 20% of total income exceeding Rs. 5,00,000 |
| Above Rs. 10,00,000 | Rs. 1,00,000 + 30% of total income exceeding Rs. 10,00,000 |
The following points are also applicable-
Note 1:- An additional 4% health & education cess will be applicable to the tax amount calculates as above. (Both Regime)
Note 2:- A tax rebate under section 87A is allowed to individual taxpayers (Age below 60 years) 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. (Old Regime)
Note 3:- 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. 10,000 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. 10,000 whichever is less. (Old Regime)
Note 4:- The surcharge over the tax calculated will be charged (subject to marginal relief) as per the below table- (Both Regime)
Also, Read- List of Benefits from Filing Income Tax Return
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% |
Must Read- How to Verify ITR- Know the 6 Ways to Verify your Income Tax Return
Frequently Asked Questions- FAQs
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What is the Income Tax Slab For AY 2021-22 for seniors?
Income Tax Slab For AY 2021-22 for individual is the same for all categories of individuals (including senior citizens) and HUFAs. Here is the new tax regime applicable in the case of senior citizen taxpayers-
🎯 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 as per Income tax slab for ay 2021-22 for senior citizens. The amount of rebate shall be 100% of the Income Tax or Rs. 12,500 whichever is less. (New Regime)
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What is the new income tax slab for 2020 21?
As per the new tax regime for FY 2020-21 following income tax slab is applicable for all individuals and HUF assessees-
🎯 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 FY 2020-21. The amount of rebate shall be 100% of the Income Tax or Rs. 12,500 whichever is less. (New Regime)
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Does AY 2021/22 have standard deductions?
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.
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What is the 80C limit for 2021 22?
Section 80C deductions to be deducted while computing total income for the financial year 2021-22. The aggregate amount of deductions allowed under section 80C (along with 80CCC & 80CCD) is Rs. 1,50,000. The deduction under section 80C is allowed only to the individual and HUF assessee. It includes LIC Payment, PPF Payment, specified sum deducted by or on behalf of the government, tuition fee of children (any 2 children), National Saving Certificate (VIII or IX issue), etc.
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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)