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Rates of Income Tax Amendments for Financial Year 2020-21 (AY : 2021-22)

1.      Income Tax Slab Rate for ‘Individual’ for Financial Year 2020-21 (AY 2021-22) opting for OLD Tax Regime :

Paragraph A of Part-III of First Schedule to the Bill provides following Rates of Income-Tax:—

(A)     Individual (Resident or Non-Resident) whose Age < 60 Years (on the last day of the Previous Year)

Net Income Range

Income-Tax Rates

Surcharge

Health and Education Cess (HEC)

Up to Rs. 2,50,000

Nil

Nil

Nil

Rs. 2,50,001 — Rs. 5,00,000

5% of (total income minus Rs. 2,50,000)

Nil

4%

Rs. 5,00,001— Rs. 10,00,000

20% of (total income minus Rs. 5,00,000)

Nil

4%

Above 
Rs. 10,00,000

30% of (total income minus Rs. 10,00,000)

Nil

4%

(B)     Resident Senior Citizen whose Age > 60 Years but < 80 Years (at any time during the Previous Year)

Net Income Range

Income-Tax Rates

Surcharge

Health and Education Cess (HEC)

Up to Rs. 3,00,000

Nil

Nil

Nil

Rs. 3,00,001 — Rs. 5,00,000

5% of (total income minus Rs. 3,00,000)

Nil

4%

Rs. 5,00,001— Rs. 10,00,000

20% of (total income minus Rs. 5,00,000)

Nil

4%

Above 
Rs. 10,00,000

30% of (total income minus Rs. 10,00,000)

Nil

4%

(C)     Resident Super Senior Citizen whose Age > 80 Years (at any time during the Previous Year)

Net Income Range

Income-Tax Rates

Surcharge

Health and Education Cess (HEC)

Up to Rs. 5,00,000

Nil

Nil

Nil

Rs. 5,00,001 — Rs. 10,00,000

20% of (total income minus Rs. 5,00,000)

Nil

4%

Above 
Rs. 10,00,000

30% of (total income minus Rs. 10,00,000)

Nil

4%

Plus :

Surcharge: - 
10% of income tax where total income exceeds Rs. 50 Lakh.
15% of income tax where total income exceeds Rs. 1 Crore.
25% of income tax where total income exceeds Rs. 2 Crore.
37% of income tax where total income exceeds Rs. 5 Crore.

Health and Education Cess (HEC) : - 
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.

Provided that in case where the total income includes any income chargeable under section 111A and section 112A of the Act, the rate of surcharge on the amount of Income-tax computed in respect of that part of income shall not exceed 15%.

Marginal Relief is provided in cases of Surcharge.

From the assessment year 2021-22 (FY 2020-21), individual and HUF tax payers have an option to opt for taxation under the newly inserted section 115BAC of the Act and the resident co-operative society has an option to opt for taxation under the newly inserted section 115BAD of the Act. This is discussed later.

2.      Income Tax Slab Rate for ‘HUF/ AOP/ BOI/ Any other Artificial Juridical Person’  for Financial Year 2020-21 (AY 2021-22) opting for OLD Tax Regime :

Net Income Range

Income-Tax Rates

Surcharge

Health and Education Cess (HEC)

Up to Rs. 2,50,000

Nil

Nil

Nil

Rs. 2,50,001 — Rs. 5,00,000

5% of (total income minus Rs. 2,50,000)

Nil

4%

Rs. 5,00,001— Rs. 10,00,000

20% of (total income minus Rs. 5,00,000)

Nil

4%

Above 
Rs. 10,00,000

30% of (total income minus Rs. 10,00,000)

Nil

4%

Plus :

Surcharge: - 
10% of income tax where total income exceeds Rs. 50 Lakh.
15% of income tax where total income exceeds Rs. 1 Crore.
25% of income tax where total income exceeds Rs. 2 Crore.
37% of income tax where total income exceeds Rs. 5 Crore.

Health and Education Cess (HEC) : - 

4% of Income Tax and Surcharge.

3.      Income Tax Slab Rate for ‘Individual and HUF’  for Financial Year 2020-21 (AY 2021-22) opting for NEW Optional Tax Regime [Section 115BAC] :

 A new tax regime for Individual and HUF has been proposed by the Finance Bill, 2020 to tax the income of such assessees at lower tax rates if they agree to forego prescribed deductions and exemptions under the Income Tax Act. Special provision for calculating income of assessees opting for this section is prescribed under the said section.

Net income range

Any Individual/ HUF

Up to Rs. 2,50,000

Nil

From Rs 2,50,001 to Rs 5,00,000

5%

From Rs 5,00,001 to Rs 7,50,000

10%

From Rs 7,50,001 to Rs 10,00,000

15%

From Rs 10,00,001 to Rs 12,50,000

20%

From Rs 12,50,001 to Rs 15,00,000

25%

Above Rs. 15,00,000

30%

Plus :

Surcharge: - 
10% of income tax where total income exceeds Rs. 50 Lakh.
15% of income tax where total income exceeds Rs. 1 Crore.
25% of income tax where total income exceeds Rs. 2 Crore.
37% of income tax where total income exceeds Rs. 5 Crore.

Health and Education Cess (HEC) : - 

4% of Income Tax and Surcharge.

Tax Rates for an Individual ( Age less than 60 years)

Total Income (Rs.)

New Regime (*)

Old Regime

Up to Rs. 2,50,000

Nil

Nil

From Rs 2,50,001 to Rs 5,00,000

5%

5%

From Rs 5,00,001 to Rs 7,50,000

10%

20%

From Rs 7,50,001 to Rs 10,00,000

15%

20%

From Rs 10,00,001 to Rs 12,50,000

20%

30%

From Rs 12,50,001 to Rs 15,00,000

25%

30%

Above Rs. 15,00,000

30%

30%

* Taxpayer opting for New Tax Regime shall not be entitled to claim specified Exemption and Deductions.

Note :

1. A Resident Individual, whose Taxable Income does not exceed Rs.5,00,000 can claim a Tax Rebate under Section 87A.

2. The amount of Rebate shall be lower of 100% of Income Tax or Rs.12,500 . It can be claimed under both New and Old Tax Regime.

4. Income Tax Slab Rate for Co-operative Societies for Financial Year 2020-2021 (AY : 2021-22)

(A) Income Tax Rates applicable to Co-operative Society under the OLD Regime :

Net Income Range

Rate of income Tax

Up to Rs. 10,000
Rs. 10,000 - Rs. 20,000
Above Rs. 20,000

10%
20%
30%

Plus:

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

Health and Education cess: 4% of income tax plus surcharge.

(B) Income Tax Rates applicable to Co-operative Society under the NEW Optional Regime [Section 115BAD] :

Income of a co-operative society under the new regime is taxable at flat Rate of 22%

-           provided it forgoes specified deductions and exemptions and computes its income in accordance with the provisions of the new inserted section.

Plus:
Surcharge:- 10% of income tax.
Health and Education cess: 4% of income tax plus surcharge.

However, the total amount payable as income-tax and surcharge on total income exceeding Rs. 1 Crore shall not exceed the total amount payable as income-tax on a total income of Rs. 1 Crore by more than the amount of income that exceeds Rs. 1 Crore.

From the assessment year 2021-22, resident co-operative societies have an option to opt for taxation under newly inserted section 115BAD of the Act. This is discussed later.

5. Income Tax Slab Rate for ‘Partnership Firm’ for Financial Year 2020-2021 (AY : 2021-22)

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.

However, the total amount payable as income-tax and surcharge on total income exceeding Rs. 1 Crore shall not exceed the total amount payable as income-tax on a total income of Rs. 1 Crore by more than the amount of income that exceeds Rs. 1 Crore.

6. Income Tax Slab Rate for ‘Companies’ for Financial Year 2020-2021 (AY : 2021-22)

(A) Income Tax Rates for ‘Domestic Companies’ for Financial Year 2020-2021 (AY : 2021-22) - No Change

Particulars

Tax rates

Company opting for section 115BA

25%

Company having turnover or gross receipt of up to Rs. 400 crore in the previous year 2017-18

30%

Company opting for section 115BAA

22%

Company opting for section 115BAB

15%

Any other company

30%

MAT

15%

(B) Income Tax Rates for ‘Foreign Companies’ for Financial Year 2020-2021 (AY : 2021-22)

The Tax Rate for Foreign Company is 40%.
Plus: - 
Surcharge:-


Company

Net income is between Rs. 1 Crore – Rs. 10 Crore

Net income exceeds Rs. Rs. 10 Crore

Domestic company

7%

12%

Foreign company

2%

5%

Health and Education cess:

4% of income tax plus surcharge.

7. Income Tax Rate for ‘Local Authority’ for Financial Year 2020-2021 (AY : 2021-22)

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.
Budget 2020 – Key Highlights Tax Amendments in Finance Bill 2020 Rates of Surcharge on Income-Tax for the Financial Year 2020-21 (AY: 2021-22)



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Tax Amendments in Finance Bill 2020

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