Latest Income Tax Slabs and Rates proposed for the Financial year 2019-20

Latest Income Tax Slabs and Rates proposed for the Financial year 2019-20

An income tax is a tax that governments impose on financial gain generated by businesses and people among their jurisdiction.

By law, taxpayers should file associate revenue enhancement to come back annually to work out their tax obligations. They have accustomed fund public services, pay government obligations, and provide goods for citizens.

So, this article is mainly written keeping in mind the queries that can arise in the brain of a common earning citizen of India. In this article, various descriptions have been given on the income tax slabs of 2019 – 2020. Tax slabs based on age groups have also been discussed. Tax slabs for the NRI and important topics like the surcharge have also been covered under this article.

Income Tax Slab for FY 2019-20 

Income Tax Update : Budget 2019-20

  • Surcharge increased by 3% for individuals earning an income of Rs. 2-5 crores and by 7% for those whose income is more than Rs. 5 crores.
  • Aadhaar card can now be used interchangeably for PAN card. Therefore, nowadays PAN is not required to file an income tax return. 
  • Additional deduction of Rs. 1.5 lakhs for interest on home loan availed for purchase of Affordable houses of up to Rs. 40 lakh till March 2020.
  • Income tax deduction of Rs. 1.5 lakhs for interest on the loan is taken to buy an electric vehicle.
  • The annual turnover limit for the corporate tax of 25% increased to Rs. 400 crores.
  • In order to discourage business payments in cash a TDS of 2% is imposed on cash withdrawal of more than Rs.1 crore in a year from a bank account. 
  • Excise Duty on fuel hiked by Re. 1.

Income tax slab for individual male and female tax payers of age less than 60 years and HUF FY 2019-20

Income range per year Tax Rate FY 2019-20, AY 2020-21 Tax Rate FY 2018-19, AY 2019-20
Up to Rs. 2.5 lakhs No Tax No Tax
Above Rs. 2.5 lakhs to Rs. 5 lakhs 5% + 4% cess 5% + 4% cess
Above Rs. 5 lakhs to Rs. 10 lakhs 20% + 4% cess 20% + 4% cess
Above Rs. 10 lakhs to Rs. 50 lakhs 30% + 4% cess 30% + 4% cess
Above Rs. 50 lakhs to Rs. 1 crore 30% + 10% surcharge + 4% cess 30% + 10% surcharge + 4% cess
Above Rs. 1 crore 30% +15% surcharge + 4% cess 30% +15% surcharge + 4% cess

Rates of income tax for senior citizens for both male and female taxpayers of age more than 60 years but less than 80 years FY 2019-20

Income range per year Tax Rate FY 2019-20, AY 2020-21 Tax Rate FY 2018-19, AY 2019-20
Up to Rs. 3 lakhs No Tax No Tax
Above Rs. 3 lakh to Rs. 5 lakhs 5% + 4% cess 5% + 4% cess
Above Rs. 5 lakhs to Rs. 10 lakhs 20% + 4% cess 20% + 4% cess
Above Rs. 10 lakhs to Rs. 50 lakhs 30% + 4% cess 30% + 4% cess
Above Rs. 50 lakhs to Rs. 1 crore 30% + 10% surcharge + 4% cess 30% + 10% surcharge + 4% cess
Above Rs. 1 crore 30% +15% surcharge + 4% cess 30% +15% surcharge + 4% cess

Rate of income tax for senior citizen for both male and female taxpayers of age more than 80 years FY 2019-20

Income range per year Tax Rate FY 2019-20, AY 2020-21 Tax Rate FY 2018-19, AY 2019-20
Up to Rs. 2.5 lakhs per annum No Tax No Tax
Up to Rs. 5 lakhs per annum No Tax No Tax
Above Rs. 5 lakhs to Rs. 10 lakhs 20% + 4% cess 20% + 4% cess
Above Rs. 10 lakhs to Rs. 50 lakhs 30% + 4% cess 30% + 4% cess
Above Rs. 50 lakhs to Rs. 1 crore 30% + 10% surcharge + 4% cess 30% + 10% surcharge + 4% cess
Above Rs. 1 crore 30% +15% surcharge + 4% cess 30% +15% surcharge + 4% cess

Tax slabs for NRI

 We all know that taxes collected from citizens are the foundation of the Indian Economy. Section NRI Taxation under the Indian Income Tax Act, 1961, applies to those earning outside the home country. But there is a huge difference of the income tax rules for them are which are drastically different from those applicable to resident Indians.

Don’t know who is called NRI? Some conditions need to be fulfilled to be an Indian citizen. Failing to which one is given the tag of an NRI.

i. If you stay at India for at least 6 months (182 days to be exact) during the whole financial year

ii. When you stay at India for 2 months (60 days) for this year in the previous year and have lived for one complete year (365 days) in the last four years. 

You are considered to be an NRI if you fail to meet any of the above conditions.

Therefore, if you are an NRI and you receive your salary directly to an Indian account it will be subject to Indian tax laws. According to the existing rules of the Income Tax Act, 1961, resident Indian and non-resident Indians (NRIs) are taxed based on the same tax slabs and rates.

The following are the IT slabs and slab rates for AY 2019-20 in case of non-resident Indians aged less than 60 years:

Income Threshold Tax rate applicable
Till ₹ 2,50,000 NIL
₹ 2,50,001 to ₹ 5,00,000 5% on income exceeding Rs. 2.5 lakh (max. Rs. 12,500)
₹ 5,00,001 to ₹ 10,00,000 20% on income exceeding Rs. 5 lakh (max. Rs. 1 lakh) + Rs. 12,500
Over ₹ 10,00,000 30% on income exceeding Rs. 10 lakh + Rs. 1 lakh + Rs.12,500

What is Surcharge?

As the name suggests, a surcharge is an additional charge or tax.

Description: When an individual earns a net taxable salary of more than Rs 1 crore, a surcharge of 10% is imposed on tax liability.

A surcharge is basically an extra charge imposed over the stated price of goods or services, added to an existing tax or added as a stand-alone charge. In order to defray the costs of increased commodity pricing (e.g., fuel surcharge), sometimes surcharges are added on as temporary measures or they are used as regular and permanent fees.

So all these pieces of information are considered to be helpful for the readers of this article. All the important topics related to taxes have been tried to be summarized in this article for the ease of the readers. I hope everyone gets a clean and clear idea about the description given.

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Soumay

Hello, I'm Soumya, Writer of Qdigita. - Engineer by Academy - Content Writer by Profession - Youtuber by Hobby - Earning Mentor by Passion
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