Government of India has increased the basic personal income tax exemption limit from ₹250,000 to ₹250,000 for Financial Year 2019-2020 and Assessment Year 2020-2021. The new income tax rates or income tax slabs are effective from April 01, 2019.
New Delhi (Delhi, India), February 04, 2020
The Government of India has increased the basic personal income tax exemption limit from ₹250,000 to ₹250,000 for the Financial Year 2019-2020 and Assessment Year 2020-2021.
The new income tax rates or Income tax slabs are applicable for the incomes earned or generated from April 01, 2019 to March 31, 2020.
Mr. Piyush Vedprakash Goyal, the Finance Minister of India, announced the new personal income tax slab rates while presenting the Union Budget of India, also called the Indian General Budget, on Friday, February 01, 2019 in New Delhi.
Here are the personal income tax slab rates for calculating your income tax for the Financial Year 2019-2020 (Assessment Year 2020-2021).
1. Income Tax Slab: ₹0 to ₹250,000 – Income Tax Rate Payable: Nil
2. Income Tax Slab: ₹250,001 to ₹500,000 – Income Tax Rate Payable: 5%
3. Income Tax Slab: ₹500,001 to ₹1,000,000 – Income Tax Rate Payable: 20%
4. Income Tax Slab: ₹1,000,001 and above – Income Tax Rate Payable: 30%
Note: Tax Relief Under Section 87A of IT Act – In case of a tax payer, having total income not exceeding ₹500,000 in the Financial Year 2019-2020, income tax chargeable on the income or ₹12,500, whichever is less.
1. Income Tax Slab: ₹0 to ₹300,000 – Income Tax Rate Payable: Nil
2. Income Tax Slab: ₹300,001 to ₹500,000 – Income Tax Rate Payable: 5%
3. Income Tax Slab: ₹500,001 to ₹1,000,000 – Income Tax Rate Payable: 20%
4. Income Tax Slab: ₹1,000,001 and above – Income Tax Rate Payable: 30%
Note: Tax Relief Under Section 87A of IT Act – In case of a tax payer, having total income not exceeding ₹500,000 in the Financial Year 2019-2020, income tax chargeable on the income or ₹12,500, whichever is less.
1. Income Tax Slab: ₹0 to ₹500,000 – Income Tax Rate Payable: Nil
2. Income Tax Slab: ₹500,001 to ₹1,000,000 – Income Tax Rate Payable: 20%
3. Income Tax Slab: ₹1,000,001 and above – Income Tax Rate Payable: 30%
10% of the Income Tax, where taxable income of an individual is ₹5,000,001 to ₹10,000,000. However, the amount of Income Tax and Surcharge shall not increase the amount of income tax payable on a taxable income of ₹50 lakhs by more than the amount of increase in taxable income.
15% of the Income Tax, where taxable income of an individual is ₹10,000,001 or above. However, the amount of Income Tax and Surcharge shall not increase the amount of income tax payable on a taxable income of ₹1 crore by more than the amount of increase in taxable income.
A 4% cess (i.e. Primary Education Cess: 2% + Secondary and Higher Education Cess: 1% + Health Cess: 1%) is payable on the total of Income Tax amount and Surcharge.
The normal income tax rates applicable to a resident individual will depend on the age of the individual. However, in case of a non-resident individual the income tax rates will be same irrespective of his or her age.
For the purpose of ascertainment of the applicable income tax slab, an individual is classified as follows:
(1) Resident individual below the age of 60 years (i.e. he or she had born on or after April 01, 1960).
(2) Resident individual of the age of 60 years or above at any time during the year but below the age of 80 years (i.e. he or she had born during April 01, 1940 to March 31, 1960).
(3) Resident individual of the age of 80 years or above at any time during the year (i.e. he or she had born before April 01, 1940).
(4) For a non-resident individual, the income tax rates will be same irrespective of the age.
Union Budget of India 2019-2020 – Minister of Finance’s Speech