1. Rebate under Section 87A changed from Rs
2,500 to Rs 12,500 or 100% of income tax (whichever is lower) for individuals
with income below Rs 5 Lakhs (from Rs 3.5 Lakhs)
2. Standard Deduction raised for
Salaried & Pensioners from Rs 40,000 to Rs 50,000
3. Increased Tax
for super-rich: Surcharge increased to 25% for income between 2 to 5 crore
& to 37% for income beyond Rs 5 crores
4. Additional Tax
Deduction of Rs 1.5 lakhs u/s 80EEA on home loans on purchase of
affordable home
5. Additional Tax
Deduction of Rs 1.5 lakhs u/s 80EEB on Auto loans on purchase of
Electric vehicles
6. No Tax on
Notional Rental Income from Second House
7. Capital gains
exemption on reinvestment in two house properties: Tax payers
can now buy two houses on sale of 1 house if the capital gains are less than Rs
2 crore. This benefit can be availed only once in lifetime
8. TDS threshold
increased from Rs 10,000 to Rs 40,000 on Bank Interest Income
Income Tax Slab Rate for AY 2020-21
1.1 Individual (resident or non-resident), who is of the age of less
than 60 years on the last day of the relevant previous year:
Net
income range
|
Income-Tax
rate
|
Up
to Rs. 2,50,000
|
Nil
|
Rs.
2,50,000- Rs. 5,00,000
|
5%
|
Rs.
5,00,000- Rs. 10,00,000
|
20%
|
Above
Rs. 10,00,000
|
30%
|
1.2 Resident senior citizen, i.e., every individual, being a
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:
Net
income range
|
Income-Tax
rate
|
Up
to Rs. 3,00,000
|
Nil
|
Rs. 3,00,000
– Rs. 5,00,000
|
5%
|
Rs.
5,00,000- Rs. 10,00,000
|
20%
|
Above
Rs. 10,00,000
|
30%
|
1.3 Resident super senior citizen, i.e., every individual, being a
resident in India, who is of the age of 80 years or more at any time during the
previous year:
Net
income range
|
Income-Tax
rate
|
Up
to Rs. 5,00,000
|
Nil
|
Rs.
5,00,000- Rs. 10,00,000
|
20%
|
Above
Rs. 10,00,000
|
30%
|
Plus: -
Surcharge: - 10% of income tax where total income exceeds Rs. 50,00,000.
15% of income
tax where total income exceeds Rs. 1,00,00,000.
Health and Education cess: - 4% of income
tax and surcharge.
Note: - A resident individual is entitled for 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.
2. Income
Tax Rate for Partnership Firm:
A partnership
firm (including LLP) is taxable at 30%.
Plus:
Surcharge:- 12% of tax where total income exceeds Rs. 1 crore.
Health and Education cess: 4% of income tax plus surcharge.
3. Tax
Rate for Companies:
Tax rates for domestic companies:
Particulars
|
Tax
rates
|
Total
turnover or gross receipts during the previous year 2017-18 doesn’t exceed
Rs. 250 Crore
|
25%
|
Other
domestic companies
|
30%
|
Tax rates for foreign companies:
The tax rate
for foreign company is 40%.
Plus: -
Surcharge:-
Company
|
Net
income is between Rs. 1Cr. – 10 Cr.
|
Net
income exceeds Rs. 10Cr.
|
Domestic
company
|
7%
|
12%
|
Foreign
company
|
2%
|
5%
|
Health and Education cess: 4% of income
tax plus surcharge.
4. Income
Tax Rates For HUF/AOP/BOI/Any other Artificial Juridical Person:
Net
income range
|
Income-Tax
rate
|
Up
to Rs. 2,50,000
|
Nil
|
Rs.
2,50,000- Rs. 5,00,000
|
5%
|
Rs.
5,00,000- Rs. 10,00,000
|
20%
|
Above
Rs. 10,00,000
|
30%
|
Plus: -
Surcharge: - 10% of income tax where total income exceeds Rs. 50,00,000.
15% of income tax where total
income exceeds Rs. 1,00,00,000.
Health and Education cess: - 4% of income tax and
surcharge.
5. Income
Tax Slab Rate for Co-operative Society:
Net
income range
|
Income-Tax
rate
|
Up
to Rs. 10,000
|
10%
|
Rs.
10,000 to Rs. 20,000
|
20%
|
Above
Rs. 20,000
|
30%
|
Plus:
Surcharge:- 12% of tax where total income exceeds Rs. 1 crore.
Health and Education cess: 4% of income tax plus
surcharge.
6. Income
Tax Slab Rate for Local Authority:
A local
authority is taxable at 30%.
Plus:
Surcharge:- 12% of tax where total income exceeds Rs. 1 crore.
Health and Education cess: 4% of income tax plus
surcharge.
CONSIDERING REBATE , LETS RECALCULATE THE MAXIMUM TOTAL
INCOME AT WHICH , THERE IS NO TAX
CATEGORY
|
<60
|
<80
|
>80
|
B]|
ASIC EXEMPTION LIMIT |
₹
2,50,000
|
₹
3,00,000
|
₹
5,00,000
|
RECALCULATING
THE MAXIMUM TOTAL INCOME AT WHICH , THERE IS NO TAX
| |||
TOTAL
INCOME AFTER DEDUCTIONS
|
₹ 5,00,000
|
₹
5,00,000
|
₹
5,00,000
|
TAX
ON TOTAL INCOME
|
₹
12,500
|
₹
10,000
|
₹ 0
|
LESS:
REBATE 87A
|
-₹
12,500
|
-₹
10,000
|
₹ 0
|
ACTUAL
TAX LIABILITY
|
₹ 0
|
₹ 0
|
₹ 0
|
SO,
EFFECTIVE TAX EXEMPTION LIMIT AT WHICH , THERE IS NO TAX
|
₹
5,00,000
|
₹
5,00,000
|
₹
5,00,000
|
LET’S FIND BREAK-EVEN
INCOME, WHERE YOU HAVE NO TAX TO PAY
ASSUMPTION – THESE
CALCULATIONS ARE DONE KEEPING IN MIND SALARIED PERSONS
FINANCIAL
YEAR 2019-2020 / ASSESSMENT YEAR 2020-2021
| ||||
<60
|
<80
|
>80
| ||
GROSS
INCOME
|
9,35,000
|
10,00,000
|
10,00,000
| |
DEDUCTIONS
FROM INCOME
|
LESS
| |||
STANDARD
DEDUCTION
|
50,000
|
50,000
|
50,000
| |
24
|
2,00,000
|
2,00,000
|
2,00,000
| |
80C
|
1,50,000
|
1,50,000
|
1,50,000
| |
80TTA
|
10,000
| |||
80TTB
|
50,000
|
50,000
| ||
80D
|
25,000
|
50,000
|
50,000
| |
NET
INCOME WHERE THERE WONT BE ANY TAX
|
TOTAL
INCOME
|
5,00,000
|
5,00,000
|
5,00,000
|
TAX
ON ABOVE INCOME
|
12,500
|
10,000
|
–
| |
REBATE
AS PER 87A
|
-12,500
|
-10,000
|
–
| |
ACTUAL
TAX LIABILITY
|
0
|
0
|
0
| |
B. POPULAR DEDUCTIONS UNDER INCOME TAX AVAILABLE TO ALL INDIVIDUALS
PLAN MAXIMUM DEDUCTIONS /
INVESTMENTS BEFORE MARCH 2020 TO MINIMIZE YOUR TAXABLE INCOME & ALSO TAX
24
|
24
=> Home loan interest
|
₹
2,00,000
|
80C
|
80C
=> LIC / PPF / KVP / EPF / SSY / NSC / HOME LOAN PRINCIPAL / SCHOOL FEES/
ELSS/STAMP DUTY
|
₹
1,50,000
|
80CCD(1B)
|
80CCD(1B)
=> NPS
|
₹
50,000
|
80DD
|
80DD
=> Exp of disabled dependent
|
75000/125000
|
80U
|
80U
=> own Physical Disability
|
75000/125000
|
80TTA
|
80TTA
= > Interest on Savings Account. Only available to Persons other than
Senior citizen / Very senior citizen
|
₹
10,000
|
80TTB
|
80TTB
= > Interest on Savings Account. and Interest on deposits with Post
Offices, Banks, Co-operative bank. Only available to senior citizen &
Very senior Citizen
|
₹
50,000
|
80G
|
80G
=> Donation ( Only if paid by cheque/ Bank Mode )
|
50%
of Donation or 10% Total income. W.E.IS HIGHER
|
80GG
|
80GG
=> deduction for the rent paid (Available to all Individuals except to
those who gets HRA from Employment). Eligibility will be least amount of the
following :-
|
|
1)
Rent paid minus 10 percent the adjusted total income.
|
||
2)
Rs 5,000 per month
|
||
3)
25 percent of the adjusted total income
|
||
80D
|
80D
=> Mediclaim For self, spouse and dependent children ( Only if paid by
cheque/ Bank Mode )
|
25000/50000
|
Up
to ₹ 25,000 [₹ 50,000 if specified person is a senior citizen or very senior
citizen
|
||
80D
|
80D
=> Mediclaim For Parents ( Only if paid by cheque/ Bank Mode )
|
25000/50000
|
Upto
Rs. 25,000 shall be allowed [Rs. 50,000 if parent is a Senior citizen / Very
Senior Citizen
|
||
Note
for 80D
|
Within
overall limit, deduction shall also be allowed up to ₹ 50,000 towards medical
expenditure incurred on the health of specified person provided such person
is a very senior citizen and no amount has been paid to effect or to keep in
force an insurance on the health of such person.
|
|
C. ALLOWANCES AND
DEDUCTIONS ONLY ALLOWED TO SALARIED INDIVIDUALS
1
|
HRA
EXEMPTION
|
A
salaried individual having a rented accommodation can get the benefit of HRA
(House Rent Allowance). However, if you aren’t living in any rented
accommodation and still continue to receive HRA, it will be taxable. HRA
exemption available to Lower of following three
|
a.Total
HRA received from your employer
|
||
b.
Rent paid less 10 percent of (Basic salary +DA)
|
||
c.
40 percent of salary (Basic+DA) for non-metros and 50 percent of salary
(Basic+DA) for metros
|
||
2
|
STANDARD
DEDUCTION
|
Rs.
50,000 Standard deduction for Assessee who has Salary/ Pension Income
|
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