Budget 2020-21
Income Tax slabs under new tax regime for all individuals for FY 2020-21 (AY 2021-22)
| Income Tax Slab | Tax Rate |
|---|---|
| Up to Rs 2.5 lakh | NIL |
| Rs 2.5 lakh to Rs 5 lakh | 5% (Tax rebate of Rs 12,500 available under section 87A) |
| Rs 5 lakh to Rs 7.5 lakh | 10% |
| Rs 7.5 lakh to Rs 10 lakh | 15% |
| Rs 10 lakh to Rs 12.5 lakh | 20% |
| Rs 12.5 lakh to Rs 15 lakh | 25% |
| Rs 15 lakh and above | 30% |
- No tax for individuals with income less than ₹ 2,50,000
- 0%-5% tax with income ₹ 2.5 lacs to 5 lacs for different age groups
- Investments upto ₹ 1.5 lacs under Sec 80C can save ₹ 46,800 in taxes.
Note : An additional 4% Health & education cess will be applicable on the tax amount calculated as above.
Let’s understand the tax calculation for rebate with the help of an example:
| Source of income (FY 2020-21) as per Old Regime | Income (Rs) |
|---|---|
| Gross Salary | 8,00,000 |
| Less: Standard deduction For Salary Person (50,000) | 7,50,000 |
| Less: Deduction under section 80C | 1,50,000 |
| Total Taxable income | 6,00,000 |
| Income-tax (@ 5% from Rs 2.5 to 5 lakh) | 12,500 |
| Income-tax (@ 20% from Rs 5 to 10 lakh) | 20,000 |
| Total Tax | 32,500 |
| Health & Education Cess (4%) | 1,300 |
| Tax Payable as per Old Regime | 33,800 |
| Source of income (FY 2020-21) as per New Regime | Income (Rs) |
|---|---|
| Gross Salary | 8,00,000 |
| No Exemptions / Deductions | Zero |
| Total Taxable income | 8,00,000 |
| Income-tax (@ 5% from Rs 2.5 to 5.00 lakh) | 12,500 |
| Income-tax (@ 10% from Rs 5.00 to 7.50 lakh) | 25,000 |
| Income-tax (@ 15% from Rs 7.50 to 10.00 lakh) | 7,500 |
| Total Tax | 45,000 |
| Health & Education Cess (4%) | 1,800 |
| Tax Payable as per New Regime | 46,800 |
Tax Benefit as per Old Regime is Rs.13000