Introduction: ITR Slabs

We all know that in India the income tax is levied on all the individuals who are counted as taxpayers. The tax is divided in different slabs slab systems, under which different tax rates have been advised for different slabs. This tax slab order is prescribed in decreasing order which keeps on increasing with an increase in the income slab.

Terms to know

Income Tax

The Tax which is imposed by the government on the income generated by businesses and individuals within one financial year is termed as income tax. As the income of the business entity or the individual increases the amount of tax is also does. This contribution to the government is the amount that is utilised by the government for the betterment of the society.

Income Tax Slab

The income tax slabs describe about the bracket under which the percentage of the tax amount to be paid is mentioned. The tax slabs increase with the increase in income. As per this slab income is categorized into different groups and criteria under a tax regime, these groups of income tax are termed as Income Tax Slabs. The income Tax slab and rate is dependent on -

• Total Income
• Residential Status 
• Type of taxpayer and age

Tax Regime

Tax Regime is the set of regulations according to which all individuals and business entities has to submit their amount to tax and the penalties if applicable to the government. As per this tax regime the taxpayers are divided as -

• Individuals below the age of 60 years
• Resident senior citizens between 60 years and below 80 years
• Resident super senior citizens who are above 80 years

Existing tax regime:-

Financial Year (FY)

It is the year in which a taxpayer has earned the income and paid tax over it. Its starts on 1^st April and ends on 31^st March.

Assessment year (AY)

It is the year which is next year of the present financial year for which you have filed your income tax return. It comes after the financial year. In the assessment year, the income earned during the financial year is assessed and taxed. Both the Financial Year and Assessment Year if calculated from 1^st April to 31^st March. For e.g. for the financial year 2018-2019, the assessment year will be 2019-2020. For instance, one says that the FY 2019-20 and AY 2020-21, is the same thing.

Income Tax Slabs for all Individuals

Income tax slabs for resident individuals below 60 years of age -

Income tax slabs for Senior Citizens

Income tax slabs for Super Senior Citizens

List deductions and exemptions.

• LTA (Leave Travel Allowance) 
• HRA (House Rent Allowance) 
• Conveyance and Daily Expenses
• Relocation and helper allowance
• Children education allowance
• Other special allowances [refer Section 10(14) Income Tax Act)]
• Professional Tax
• Interest on housing loan (Section 24 of Income Tax Act)
• Chapter VI-A deduction covered under sections - 80C,80D, 80E etc. of Income Tax Act (Except Section 80CCD(2) and 80JJA)

Income Tax Slabs HUF

As per section 87A, the tax rebate is –

• FY 2018-19 income up to 3.5 lac, rebate amount - 2,500
• FY 2019-20 income up to 5 lac, rebate amount - 12,500

Income Tax Slab for Indian Companies

Surcharges are applicable as –

• If in case the net income exceeds INR 1 Crore but doesn’t exceed INR 10 Crore, then the surcharge will be 7%
• If in case the net income exceeds INR 10 Crore, then the surcharge will be 12%

Income Tax Slabs for NRI (Non–Resident Individuals)

Income Tax Slab for Co-operative Society

• Tax imposed will be at 25% + 4% + Surcharge – in case the turnover or gross receipt is up to 400 Crore.
• Tax Imposed will be at 30% + 4% + Surcharge - in case the turnover or gross receipt is more than 400 crores.

Income Tax Slab for Foreign Company

• The Tax rate imposed will be at 50% + 4% cess + Surcharge in case the royalty has been received from the government

Experts call

Income is one of the vital part of a business lifeline. With the introduction of the Union Budget, it tends to get change in every new financial year. These changes are done to support business holders so that they can get maximum rebate on the taxes. It’s really important to be updated with the new norms of the slabs and exemptions. Income Tax played an important role in the revenue generation of the government as about 71% of total government revenue is collected through the Tax. In the end of every financial year we have to file the income tax, failing so can lead to penalties. For further inquiries, feel free to contact Corpseed.