Income Tax Slabs in India for FY 2019-2020 Last Updated : 18 Sep 2019

Income tax slabs and tax rates for FY 2019-20 are applicable to those who earn more than Rs.2.5 lakh p.a. The rate at which individuals are taxed depends on the level of income they earn, with rates charged at nil, 5%, 20% and 30%.

About Income Tax Slabs for FY 2019-20

In February 2019, the government announced certain changes in the structure of the tax slabs. As per the Interim Budget 2019, which came into effect from 1 April 2019, a Rs.12,500 rebate under Section 87A of the Income Tax Act, 1961, will be available to individuals who have an income of up to Rs.5 lakh. However, no changes have been made to the tax slabs and rates for the FY 2019-2020.

Learn more about Income Tax, Income Tax e-Filing, Income Tax Return and Income Tax Refund in our other articles.

Various Income Tax Slabs

Depending on the individual’s age, various tax slabs are proposed by the government. The three different types of individual taxpayers are mentioned below:

  • Individuals who are below the age of 60 years. It can include individuals who are residents as well as non-residents.
  • Senior citizens who are above the age of 60 years and below the age of 80 years and are resident Indians.
  • Super senior citizens who are above the age of 80 years old and are resident Indians.

Given below are the three various tables for the latest Income Tax Slabs for the FY 2019-2020:

1. Income Tax Slab for Individual who are below 60 years:

Income Tax slab Tax Rate
Up to Rs.2.5 lakh Nil
From Rs.2,50,001 to Rs.5,00,000 5% of the total income that is more than Rs.2.5 lakh + 4% cess
From Rs.5,00,001 to Rs.10,00,000 20% of the total income that is more than Rs.5 lakh + Rs.12,500 + 4% cess
Income of above Rs.10 lakh 30% of the total income that is more than Rs.10 lakh + Rs.1,12,500 + 4% cess

Individuals who have an income of less than Rs.5 lakh are eligible for tax deductions under Section 87A

Given below is an example of how income tax is calculated for 3 individuals (A, B, and C):
Components A B C
Annual Salary (Rs.) 5,00,000 10,00,000 15,00,000
Standard Deduction (Rs.) 50,000 50,000 50,000
Tax deductions under Section 80C of the Income Tax Act (Rs.) 70,000 1,50,000 1,50,000
House Rent Allowance deductions 82,000 90,000 1,40,000
Gross total income after deductions (Rs.) 2,88,000 7,00,000 11,50,000
Computation of tax on the gross total income
Up to Rs.2.5 lakh (Rs.) Nil Nil Nil
From Rs.2,50,001 to Rs.5 lakh (Rs.) 1,900 12,500 12,500
From Rs,5,00,001 to Rs.10 lakh (Rs.) 40,000 1,00,000
Above Rs.10 lakh (Rs.) 45,000
Total Tax (Rs.) 1,900 52,500 1,57,500
Deductions under Section 87A (Rs.) 1,900 Nil Nil
Additions of cess (Rs.) Nil 2,100 6,300
Total tax that is payable (Rs.) (Total Tax + cess – Deductions under Section 87A) Nil 54,600 1,63,800

2. Income Tax Slab for indivitual between 60-80 years:

Income Tax slabs Tax Rate
Up to Rs.3 lakh Nil
From Rs.3,00,001 to Rs.5,00,000 5% of the total income that is more than Rs.3 lakh + 4% cess
From Rs.5,00,001 to Rs.10,00,000 20% of the total income that is more than Rs.5 lakh + Rs.10,500 + 4% cess
Income of above Rs.10 lakh 30% of the total income that is more than Rs.10 lakh + Rs.1,10,000 + 4% cess

Given below is an example of how income tax is calculated for 3 individuals (A, B, C):
Components A B C
Annual Salary (Rs.) 5,00,000 10,00,000 15,00,000
Standard deduction (Rs.) 50,000 50,000 50,000
Tax deductions under Section 80C of the Income Tax Act (Rs.) 70,000 1,50,000 1,50,000
House Rent Allowance deductions 82,000 90,000 1,40,000
Gross total income after deductions (Rs.) 2,88,000 7,00,000 11,50,000
Computation of tax on the gross total income
Up to Rs.3 lakh (Rs.) Nil Nil Nil
From Rs.3,00,001 to Rs.5 lakh (Rs.) Nil 10,500 10,500
From Rs,5,00,001 to Rs.10 lakh (Rs.) 40,000 99,500
Above Rs.10 lakh (Rs.) 45,000
Total Tax (Rs.) Nil 50,500 1,55,000
Deductions under Section 87A (Rs.) Nil Nil Nil
Additions of cess (Rs.) Nil 2,020 6,200
Total tax that is payable (Rs.) Nil 52,520 1,61,200

3. Income Tax Slabs for individual above 80 years:

Income Tax slabs Tax Rate
Up to Rs.5 lakh Nil
From Rs.5,00,001 to Rs.10,00,000 20% of the total income that is more than Rs.5 lakh + 4% cess
Above Rs.10 lakh 30% of the total income that is more than Rs.10 lakh + Rs.1,00,000 + 4% cess

Given below is an example of how income tax is calculated for 3 individuals (A, B, C):
Components A B C
Annual Salary (Rs.) 5,00,000 10,00,000 15,00,000
Standard deduction (Rs.) 50,000 50,000 50,000
Tax deductions under Section 80C of the Income Tax Act (Rs.) 70,000 1,50,000 1,50,000
House Rent Allowance deductions 82,000 90,000 1,40,000
Gross total income after deductions (Rs.) 2,88,000 7,00,000 11,50,000
Computation of tax on the gross total income
Up to Rs.5 lakh (Rs.) Nil Nil Nil
From Rs,5,00,001 to Rs.10 lakh (Rs.) 40,000 1,00,000
Above Rs.10 lakh (Rs.) 45,000
Total Tax (Rs.) Nil 40,000 1,45,000
Deductions under Section 87A (Rs.) Nil Nil Nil
Additions of cess (Rs.) Nil 1,600 5,800
Total tax that is payable (Rs.) Nil 41,600 1,50,800

For domestic companies, the tax-slabs depend on the turnover, and it is mentioned below:

Turnover Tax Rate
Gross turnover can be a maximum of Rs.250 crore for the previous year 25%
Gross turnover is more than Rs.250 for the previous year 30%
Apart from the above-mentioned tax rate, an additional surcharge and cess are levied. Given below are the details of the surcharge and the cess that will be levied:
  • Cess: 4% of corporate tax
  • Surcharge: In case the taxable income is more than Rs.1 crore but less than Rs.10 crore, the surcharge that will be levied is 7%. In case the taxable income is more than Rs.10 crore, the surcharge that will be levied is 12%.
  • Non-resident Indians: For non-resident Indians, irrespective of their age, the exemption limit is up to Rs.2.5 lakh.
Important Points
  • In case your net income is more than Rs.50 lakh but less than Rs.1 crore, apart from a 4% cess, a 10% surcharge is also levied. If the net is above Rs.1 crore, a 15% surcharge is levied.
  • Compared to last year’s budget, cess has increased from 3% to 4%.

News About Income Tax Slabs

  • ITR must be filed by housewives who do not make an income

    Most homemakers think they do not need to file their ITR as they are not making an income. However, in certain cases, it is vital that the ITR is filed on time. There are many benefits to filing the returns as well, even if homemakers are not liable to pay tax.

    Depending on the income that is generated in a year, tax returns must be paid by a homemaker or any other individual. Individuals who generate an annual income of less than Rs.2.5 lakh and are below the age of 60 years are not required to file ITR. The limits are Rs.3 lakh and Rs.5 lakh for individuals who are between the ages of 60 years and 80 years and above 80 years, respectively. However, in some cases, money is received by homemakers from different sources. Depending on the source of income, homemakers must file their ITR. In case the housewife receives money from her husband and an investment is made in her name, the amount will not be taxable. However, if any income is generated from that money, tax must be paid for those returns. Interest that is generated from fixed deposits that were gifted by parents must also be taxed. The amount of tax that must be paid will depend on the tax slab the homemaker falls under.

    25 July 2019

  • Ways to save income tax by investing in case income is more than Rs.5 lakh

    Individuals who earn a taxable income of over Rs.5 lakh can invest in particular investment schemes to avoid paying income tax. The tax exemption limit is Rs.2.5 lakh. In case an individual’s yearly salary is Rs.5 lakh, he/she can earn Rs.12,500 as a full rebate on the tax that is liable.

    In case an individual earns Rs.5 lakh and above, the tax slab on the income that is made for Rs.2.5 lakh and more is applied for them. Therefore, if the taxable income of the individual is Rs.6.5 lakh, the individual will not receive a rebate and tax must be paid depending on the tax slab. However, individuals can avoid paying tax by investing in certain tax-saving instruments. However, this option is not available for all categories of income. In case individuals have availed a home loan, they can claim benefits of up to Rs.1.5 lakh on the interest that is being paid on the house loan. Further, investments can be made in schemes under Section 80C of the Income Tax Act as they offer tax benefits of up to Rs.1.5 lakh. Under Section 87A of the Income Tax Act, individuals can also claim a tax rebate of Rs.12,500. Individuals can also claim tax benefits of up to Rs.1.5 lakh for repayment of home loans and payment of their child’s tuition fees.

    23 July 2019

  • Marginal relief that is applicable in Income Tax surcharge

    Earlier, a surcharge of 15% was levied on taxpayers who made an income of more than Rs.2 crore per year. However, the surcharge has been increased to 25% for individuals who earn between Rs.2 crore and Rs.5 crore as per the Union Budget 2019. The surcharge has also been increased to 37% for individuals who earn more than Rs.5 crore in a year. Additionally, the surcharge is 10% and 15% for individuals who earn between Rs.50 lakh and Rs.1 crore and between Rs.1 crore and Rs.2 crore.

    Under this category, marginal relief comes into effect. For example, in case an individual earns Rs.51 lakh in a year, he/she will have to pay a surcharge of 10%. The net tax liability that is payable comes up to Rs.13,42,500. Therefore, the surcharge that must be paid is Rs.1,34,250. However, this amount is higher than the difference between the taxable income and the tax bracket, which is Rs.51 lakh and Rs.50 lakh, respectively. The difference in the amount is adjusted in the marginal relief. Therefore, Rs.70,000 is the net income above Rs.50 lakh. Since the surcharge is Rs.70,000, the net tax payable comes up to Rs.14,69,000 which is inclusive of the 4% education and health cess (Rs.56,500). According to the Income Tax Act, 1961, marginal relief is provided to taxpayers who make a taxable income above the threshold limit where the surcharge is applicable, but the surcharge is more than the net income that is above the threshold.

    19 July 2019

  • Understanding the income tax changes that affect the super-rich

    As per the Budget 2019-2020, a proposal has been put forward by the government to increase the applicable surcharge to individuals who make a taxable income of more than Rs.2 crore. A surcharge is an additional charge that is levied on individuals who make a high income of money. However, the government did not make any changes to the current income tax structure.

    The important tax changes that affect the super-rich are mentioned below:

    The surcharge rates have been increased to 25% from 15% for individuals who make an income of above Rs.2 crore but below Rs.5 crore.

    The surcharge has increased from 15% to 37% for individuals who earn more than Rs.5 crore.

    The surcharge remains the same for individuals who make an income of less than Rs.2 crore. Individuals who earn more than Rs.50 lakh but less than Rs.1 crore, the surcharge is 10% and for individuals who earn more than Rs.1 crore but less than Rs.2 crore, the surcharge remains at 15%.

    The highest tax rate for individuals who earn between Rs.2 crore and Rs.5 crore will increase to 39% from 35.88%. The tax rate has been increased to 42.74% from 35.88% for individuals who make an income of more than Rs.5 crore.

    15 July 2019

  • Union Budget impact on NRIs

    The Finance Minister of India, Nirmala Sitharaman, presented the Union Budget in the Parliament on 5 July 2019. The budget did not disappoint Non-Resident Indians (NRIs) as well as resident Indians. Emphasis was given on improving the transparency in the process of taxations as well as boosting the infrastructure investment.

    Some of the highlights that will be a boost to NRIs are infrastructure development of railways and airports and emphasis in Digital Payments and Digital India. There has been an increase in the personal income tax rate due to the higher surcharge that has been levied for the very rich. Income rates go up by 39% for individuals who make an income between Rs.2 crore and Rs.5 crore and by almost 43% for individuals who make an income of more than Rs.5 crore. There has been a change in the gift tax provisions for NRIs as well. NRIs who receive any gift worth Rs.50,000 or more after 5 July 2019, will have to disclose the gift as an Indian income and pay tax depending on the tax slab they fall under. The threshold limit for Tax Deducted at Source (TDS) has also been increased from Rs.1.8 lakh to Rs.2.4 lakh on rental income. An event titled ‘Annual Global Investors Meet’ has also been proposed by the Budget. This will help in bringing an impetus on NRI investments in India.

    15 July 2019

  • The revised income tax slabs and rates for financial year 2019-20

    The interim budget for 2019 was recently announced on 1 February 2019. In this budget, a full tax rebate was announced for all the tax paying assessees who have a taxable income of up to Rs.5 lakh. This rebate will be applicable under Section 87A of the Income Tax Act. This rebate will provide tax savings of up to Rs.12,500 for all the assessees in this income bracket. Taxpayers who can save more will be able to push the rebate further and can get a full tax rebate for an income of up to Rs.6.5 lakh.

    No changes have been implemented for the tax slabs, only the rebate has been introduced. Thus, there will be no effect on the tax incidence of those who have a larger income. However, individuals with an income of under Rs.10 will be able to add tuition fees and home loans to get additional benefits. The acting Finance Minister Piyush Goyal announced that income from interest for amounts up to Rs.40,000 will be exempted from tax. However, the implementation of this exemption will decided by the next government after the Lok Sabha elections. Goyal also added that the standard deduction for the salaried class will be increased from Rs.40,000 to Rs.50,000.

    15 February 2019

  • The revised income tax slabs and rates for financial year 2019-20

    The interim budget for 2019 was recently announced on 1 February 2019. In this budget, a full tax rebate was announced for all the tax paying assessees who have a taxable income of up to Rs.5 lakh. This rebate will be applicable under Section 87A of the Income Tax Act. This rebate will provide tax savings of up to Rs.12,500 for all the assessees in this income bracket. Taxpayers who can save more will be able to push the rebate further and can get a full tax rebate for an income of up to Rs.6.5 lakh.

    No changes have been implemented for the tax slabs, only the rebate has been introduced. Thus, there will be no effect on the tax incidence of those who have a larger income. However, individuals with an income of under Rs.10 will be able to add tuition fees and home loans to get additional benefits. The acting Finance Minister Piyush Goyal announced that income from interest for amounts up to Rs.40,000 will be exempted from tax. However, the implementation of this exemption will decided by the next government after the Lok Sabha elections. Goyal also added that the standard deduction for the salaried class will be increased from Rs.40,000 to Rs.50,000.

    15 February 2019

  • Tamil Nadu government all praise for GST, calls it transparent and self-policing tax regime

    A minister recently praised the Goods and Services Tax (GST) in a Tamil Nadu government assembly. The minister described the newly implemented tax system as a “transparent and self-policing tax regime”. Commercial Taxes Minister KC Veeramani recalled the year-old rollout of the new central tax regime which subsumed many other taxes and said that GST was a “landmark in the field of indirect tax reforms.”

    The Goods and Services Tax (GST) was introduced with the view of subsuming the different central and state taxes which created a cascading effect of tax. It prevented the cascading effect and paved way for a common national market, Veeramani added. The main objective of GST was to make the Indian products competitive in domestic and international markets and provide the necessary momentum to the growth of the economy. He further said that the abolishment of check-posts has allowed the hassle-free movement of goods across the nation. Veeramani also said that the Commercial Taxes department collected revenues worth Rs.73,148.28 crore in the financial year 2017-18. This collection also includes the GST compensation and IGST settlement advance. He concluded that the revenue collection had seen a growth of 10.51% in spite of the uncertainties in the country in terms of the economy.

    4 July 2018

  • What is standard deduction?

    Standard deduction is basically a benefit that some income tax payers receive, irrespective of the investments made or the expenses they have incurred. In order to claim standard deduction, the assessee need not submit any proof or document.

    Based on Section 16 of the Income Tax Act 1961, a pensioner or salaried individual can claim standard deduction up to Rs.40,000. Standard deduction is available from the financial year 2018-19, and will be applicable from the assessment year 2019-2020.

    19 June 2018

  • GST impact on FMCG: Beneficial, but contentious issues remain

    The fast moving consumer goods (FMCG) in India has grown from $31.6 billion in 2011 to $49 billion in 2016. The fast moving consumer goods (FMCG) is the fourth largest sector in the Indian economy. There are 3 main segments in this sector. They are- personal care products, healthcare products, and foods and beverages. The personal care products account for 50% of the entire sector. It is followed by healthcare products which consist of 31% and foods and beverages which consist of 19% of the sector.

    The sector is constantly growing. It is expected to grow at Compound Annual Growth Rate (CAGR) of 20.6% by 2020. This will help the sector reach a worth of $103.7 billion. The fast moving consumer goods (FMCG) saw a growth of 14.8% from October 2017 to December 2017. The expected net revenue growth for the fast moving consumer goods (FMCG) is 11.8% in Q4 March 2018. These statistics conclude that the sector has performed well under the Goods and Services Tax (GST) regime and has witnessed smooth transition.

    15 June 2018

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