You are currently viewing INCOME TAX SLAB AND RATES FOR F.Y. 2020-21(A.Y 2021-22)

INCOME TAX SLAB AND RATES FOR F.Y. 2020-21(A.Y 2021-22)

What is New Tax Regime?

The Finance Minister introduced a new tax regime for individual & HUF taxpayers under Section 115BAC of the Income Tax Act, 1961. Under the new tax regime, you can opt for concessional income tax rates. But, you will not be able to avail 70 deductions in the new tax regime. The new tax regime was introduced to simplify the income tax law wherein the new income tax rate will be reduced for taxpayers who forgo some of the deductions and exemptions available as per Income Tax Act, 1961.

1. Income Tax Rate & Slab for Individuals & HUF in AY 2021-22

Individual (Resident or Resident but not Ordinarily Resident or non-resident), who is of the age of less than 60 years on the last day of the relevant previous year & for HUF:

Income-Tax-Rate-Slab-for-Individuals-HUF

2. Income Tax Rate & Slab for Senior Citizens in AY 2021-22

Resident or Resident but not Ordinarily Resident senior citizen, i.e., every individual, being a resident or Resident but not Ordinarily Resident in India, who is of the age of 60 years or more but less than 80 years at any time during the previous year:

Income-Tax-Slab-for-Senior-Citizens

3. Income Tax Rate & Slab for Super Senior Citizens in 2021-22

Resident or Resident but not Ordinarily Resident super senior citizen, i.e., every individual, being a resident or Resident but not Ordinarily Resident in India, who is of the age of 80 years or more at any time during the previous year.

Budget 2021 update : It has been proposed to exempt the senior citizens from filing income tax returns if pension income and interest income are their only annual income source. Section 194P has been newly inserted to enforce the banks to deduct tax on senior citizens more than 75 years of age who have a pension and interest income from the bank.

 Income-Tax-Slab-Super-Senior-Citizens
Surcharge:

a)   10% of Income Tax where total income exceeds Rs.50 Lacs 

b)   15% of Income Tax where total income exceeds Rs. 1 crore

c)   25% of Income Tax where total income exceeds Rs. 2 crore

d)  37% of Income tax where total income exceeds Rs.5 crore 

Note: Enhanced Surcharge rate (25% or 37%) is not applicable in case of specified incomes I.e. short-term capital gain u/s 111A, long-term capital gain u/s 112A & short-term or long-term capital gain u/s 115AD(1)(b).

Education Cess: 4% of income tax plus surcharge 

Note:- A Resident or Resident but not Ordinarily Resident individual is entitled to rebate under section 87A if his total income does not exceed Rs.5, 00,000. The amount of rebate shall be 100% of income-tax or Rs.12,500, whichever is less. rebate under section 87A is available in both scheme I.e. existing scheme as well as new scheme.

Income Tax Slab and Rates For Individual PDF File Available Click Here

To know about this optional New Scheme which is optional for individual and HUF Click Here

Income Tax Rates & Slab for AOP/BOI/Any other Artificial Juridical Person:

Surcharge:

a) 10% of Income tax where total income exceeds Rs.50 lakh
b) 15% of Income tax where total income exceeds Rs.1 crore
c) 25% of Income tax where total income exceeds Rs.2 crore
d) 37% of Income tax where total income exceeds Rs.5 crore

Note: Enhanced Surcharge rate (25% or 37%) is not applicable in case of specified incomes I.e. short-term capital gain u/s 111A, long-term capital gain u/s 112A & short-term or long-term capital gain u/s 115AD(1)(b).

Education cess: 4% of tax plus surcharge

Tax Rate For Partnership Firm:

A partnership firm (including LLP) is taxable at 30%.

Surcharge: 12% of Income tax where total income exceeds Rs. 1 crore

Education cess: 4% of Income tax plus surcharge

Income Tax Slab Rate for Local Authority:

A local authority is Income taxable at 30%.

Surcharge: 12% of Income tax where total income exceeds Rs. 1 crore

Education cess: 4% of tax plus surcharge

Tax Rates for Domestic Company:

A domestic company is taxable at 30%. However, the tax rate is 25% if turnover or gross receipt of the company does not exceed Rs. 400 crore in the previous year.

Tax Rate & Slab for Domestic Company
Note 1: Section 115BA –

 A domestic company which is registered on or after March 1, 2016 and engaged in the business of manufacture or production of any article or thing and research in relation to (or distribution of) such article or thing manufactured or produced by it and also It is not claiming any deduction u/s 10AA, 32AC, 32AD, 33AB, 33ABA, 35(1)(ii)/(iia)/(iii)/35(2AA)/(2AB), 35AC, 35AD, 35CCC, 35CCD, section 80H to 80TT (Other than 80JJAA) or additional depreciation, can opt section 115BA on or before the due date of return by filing Form 10-IB online. Company cannot claim any brought forwarded losses (if such loss is related to the deductions specified in above point).

Note 2: Section 115BAA

 Total income of a company is taxable at the rate of 22% (from A.Y 2020-21), if the following conditions are satisfied:
– Company is not claiming any deduction u/s 10AA or 32(1)(iia) or 32AD or 33AB or 33ABA or 35(1)(ii)/(iia)/(iii)/35(2AA)/(2AB) or 35AD or 35CCC or 35CCD or section 80H to 80TT (Other than 80JJAA).
– Company is not claiming any brought forwarded losses (if such loss is related to the deductions specified in above point).
– Provisions of MAT is not applicable on such company after exercising of option. company cannot claim the MAT credit (if any available at the time of exercising of section 115BAA).

Note 3: Section 115BAB – 

Total income of a company is taxable at the rate of 15% (from A.Y 2020-21), if the following conditions are satisfied:

– Company (not covered in section 115BA and 115BAA) is registered on or after October 1, 2019 and commenced manufacturing on or before 31st March, 2023.
– Company is not formed by splitting up or reconstruction of a business already in existence.
– Company does not use any machinery or plant previously used for any purpose.
– Company does not use any building previously used as a hotel or a convention center, as the case may be.
– Company is not engaged in any business other than the business of manufacture or production of any article or thing and research in relation to (or distribution of) such article or thing manufactured or produced by it. Business of manufacture or production shall not includes business of –

  • Development of computer software;
  • Mining ;
  • Conversion of marble blocks or similar items into slabs;
  • Bottling of gas into cylinder;
  • Printing of books or production of cinematographic film; or
  • Any other notified by Central Govt.

– Company is not claiming any deduction u/s 10AA or 32(1)(iia) or 32AD or 33AB or 33ABA or 35(1)(ii)/(iia)/(iii)/35(2AA)/(2AB) or 35AD or 35CCC or 35CCD or section 80H to 80TT (Other than 80JJAA and 80M).

– Company is not claiming any brought forwarded losses (if such loss is related to the deductions specified in above point).

– Provisions of MAT is not applicable on such company after exercising of option. company cannot claim the MAT credit (if any available at the time of exercising of section 115BAA).

Surcharge:
a) 7% of Income tax where total income exceeds Rs.1 crore
b) 12% of Income tax where total income exceeds Rs.10 crore
c) 10% of income tax where domestic company opted for section 115BAA and 115BAB

Education cess: 4% of Income tax plus surcharge

Tax Rates for Foreign Company

A foreign company is taxable at 40%

Surcharge:
a) 2% of Income tax where total income exceeds Rs. 1 crore
b) 5% of Income tax where total income exceeds Rs. 10 crore

Education cess: 4% of Income tax plus surcharge

Income Tax Rate & Slab for Co-operative Society

Income Tax Rate & Slab for Co-operative Society

Surcharge:

  1. a) 12% of Income tax where total income exceeds Rs. 1 crore
  2. b) In case of Concessional scheme, surcharge rate is 10%

Education cess: 4% of Income tax plus surcharge

Disclaimer

This information has been taken from https://www.incometaxindia.gov.in/news/finance-act-2020.pdf. Tax laws are subject to amendments made thereto from time to time. Please consult a professional tax advisor before acting on the above.

To know about this optional New Scheme which is optional for Co-operative society Click Here

List of Deductions not available in New Tax Regime

Individuals who opt for the income tax slab 2020 under the new tax regime will not be able to avail some of the popular deductions and exemptions under the Income Tax Act, 1961. Following are some of the deductions and exemptions out of 70 deductions that you will need to forgot under the new tax regime:

    • Section 80C Deduction
    • Section 80D
    • Any deduction Under Chapter VI-A
    • Standard Deduction
    • Leave Tax Allowance (LTA)
    • House Rent Allowance (HRA)
    • Interest on Housing Loan U/s 24
    • Professional Tax

*Except Section 80CCD (2) and 80JJAA

FAQ on Income Tax

​​It is a tax levied by the Government of India on the income of every person. The provisions governing the Income-tax are covered in the Income-tax Act, 1961.Accordion Sample Description
Income-tax is levied on the annual income of a person. The year under the Income-tax Law is the period starting from 1st April and ending on 31st March of next calendar year. The Income-tax Law classifies the year as (1) Previous year, and (2) Assessment year. The year in which income is earned is called as previous year and the year in which the income is charged to tax is called as assessment year. e.g., Income earned during the period of 1st April, 2020 to 31st March, 2021 is treated as income of the previous year 2020-21. Income of the previous year 2020-21 will be charged to tax in the next year, i.e., in the assessment year 2021-22.​Accordion Sample Description
Advance tax is to be calculated on the basis of expected tax liability of the year. Advance tax is to be paid in instalments as given below:​​ a) In case of all the assessees (other than the eligible assessees as referred to in section 44AD and 44ADA) : i) Atleast to 15 per cent – On or before 15th June ii) Atleast to 45 per cent – On or before 15th September iii) Atleast to 75 per cent – On or before 15th December​ iv) Atleast to 100 per cent –On or before 15th March b) In case of eligible assessee as referred to in section 44AD and 44ADA: ​​ 100 per cent – On or before 15th March Note: Any tax paid on or before 31st day of March shall also be treated as advance tax paid during the same financial year. The deposit of advance tax is made through challan ITNS 280 by ticking the relevant column, i.e., advance tax.​
​​​​​​​​​Agricultural income is not taxable. However, if you have non-agricultural income too, then while calculating tax on non-agricultural income, your agricultural income will be taken into account for rate purpose. For meaning of Agricultural Income refer section 2(IA)​ of the Income-tax Act.
For every source of income you have to maintain proof of earning and the records specified under the Income-tax Act. In case no such records are prescribed, you should maintain reasonable records with which you can support the claim of income.
Profession means exploitation of one’s skills and knowledge independently. Profession includes vocation. Some examples are legal, medical, engineering, architecture, accountancy, technical consultancy, interior decoration, artists, writers, etc.
You can check your Aadhaar-PAN Linking status from the following link: https://www1.incometaxindiaefiling.gov.in/e-FilingGS/Services/AadhaarPreloginStatus.html
​​Yes. However, pension received from the United Nations Organisation is exempt.
​​​No, it is taxable as income from other sources.​
Senior citizens and a very senior citizen are granted a higher exemption limit as compared to normal tax payers. Exemption limit is the quantum of income up to which a person is not liable to pay tax. The exemption limit granted to senior citizen and very senior citizen for the financial year 2020-21 is as follows : Senior citizen Very senior citizen A senior citizen is granted a higher exemption limit compared to non-senior citizens. The exemption limit for the financial year 2020-21 available to a resident senior citizen is Rs. 3,00,000. The exemption limit for non-senior citizen is Rs. 2,50,000. Thus, it can be observed that an additional benefit of Rs. 50,000 in the form of higher exemption limit is available to a resident senior citizen as compared to normal tax payers. A very senior citizen is granted a higher exemption limit compared to others. The exemption limit for the financial year 2020-21 available to a resident very senior citizen is Rs. 5,00,000. The exemption limit for non-senior citizen is Rs. 2,50,000. Thus, it can be observed that an additional benefit of Rs. 2,50,000 in the form of higher exemption limit is available to a resident very senior citizen as compared to normal tax payers.
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