Income Tax Rate Slab 2019-20 - An Overview

Income Tax Rate Slab 2019-20 - An Overview

Income tax also known as progressive tax is the rate at which payable tax on the income of an individual increase with the income of the assesses. Income tax slabs rates denote the threshold annual income limits at which a high or low rate of tax is applicable. In today’s blog, we will discuss the income tax rate slabs 2019-20 along with some other key features of income tax in India.

Income Tax Slabs for the year 2019-2020:

There are various slabs according to which income tax is assessed for the various individuals. All of them are given as follows:

  1. Hindu Undivided Families (HUFs)

Hindu Undivided Family (HUF) is headed by the designated head of the family or Karta. HUF have a legal identity just like an artificial judicial person for who is liable for taxation purposes. The following are the Income Tax slab rates applicable to Hindu Undivided Families for 2019-20:

Income Threshold

Applicable tax rates on the income threshold

Up to Rs. 2,50,000

Nil

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

5% on income exceeding a limit of Rs. 2.5 lakhs that is maximum Rs. 12,500

Rs. 5,00,001 to Rs. 10,00,000

20% on income exceeding the limit of Rs. 5 lakhs maximum up to  Rs. 1 lakh + Rs. 12,500

Over Rs. 10,00,001

30% on income exceeding limit of Rs. 10 lakhs + Rs. 1 lakh + Rs. 12,500

Add on components:

Surcharge: Applicable surcharge in case of income more than Rs. 50 lakhs and less than Rs. 1 crore would be 10% while surcharge for income, more than Rs. 1 crore would be 15% on the amount exceeding the limit of Rs. 1 crore.

Health and Education cess: now the Education and Secondary and Higher Education Cess would be replaced by “Health and Education Cess” at the rate of 4%, inclusive of all the surcharges.

  1. Residents and non- resident Indians:

As per the Income Tax Act, 1961, resident and non-resident Indians (NRIs) are taxed under the same income tax slabs and rates without any distinguish. The following are the Income Tax slabs rates for resident and non-resident Indians aged less than 60 years:

 

Income Threshold

Applicable tax rates on the income threshold

Up to Rs. 2,50,000

NIL

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

5% on income exceeding the limit of Rs. 2.5 lakh up to a maximum limit of  Rs. 12,500

Rs.  5, 00,001 to Rs.  10,00,000

20% on income exceeding the limit of Rs. 5 lakh up to a maximum limit of  Rs. 1 lakh + Rs. 12,500

Over Rs.  10,00,001

30% on income exceeding the limit of Rs. 10 lakh + Rs. 1 lakh + Rs. 12,500

Add on components:

Surcharge: Applicable surcharge in case of income more than Rs. 50 lakhs and less than Rs. 1 crore would be 10% while surcharge for income, more than Rs. 1 crore would be 15% on the amount exceeding the limit of Rs. 1 crore.

Health and Education cess: now the Education and Secondary and Higher Education Cess would be replaced by “Health and Education Cess” at the rate of 4%, inclusive of all the surcharges.

The interim union budget 2019 has provided a full tax rebate to the individuals who have a net taxable income up to Rs 5lakhs. It simply means that the maximum tax rebate provided under section 87A has been increased from Rs. 2,500 to Rs. 12,500. Individuals having net taxable income up to the limit of Rs. 5lakhs can claim the tax rebate under the section 87A and thus can pay zero tax rates.

  1. Senior Citizens:

Individuals aged over 60 years and less than 80 years comes under the Senior Citizen category as per current tax rules. The following are the income tax slab rates for senior citizens:

Income Threshold

The applicable Tax rate on the income threshold

Up to Rs. 3,00,000

Nil

Rs. 3, 00,001 to Rs.  5,00,000

5% on income exceeding the limit of Rs. 3 lakh up to a maximum limit of Rs. 10,000

Rs. 5, 00,001 to Rs.  10,00,000

20% on income exceeding the limit of Rs. 5 lakh up to a maximum of  Rs. 1 lakh + Rs. 10,000

Over Rs.  10,00,001

30% on income exceeding the limit of Rs. 10 lakh + Rs. 1 lakh + Rs. 10,000

Add on components:

Surcharge: Applicable surcharge in case of income more than Rs. 50 lakhs and less than Rs. 1 crore would be 10% while surcharge for income, more than Rs. 1 crore would be 15% on the amount exceeding the limit of Rs. 1 crore.

Health and Education cess: now the Education and Secondary and Higher Education Cess would be replaced by “Health and Education Cess” at the rate of 4%, inclusive of all the surcharges.

  1. Super Senior Citizens:

Individuals over 80 years come under this category. The following are the income tax slab rates for super senior citizens:

Income Threshold   

Applicable tax rates on the income threshold

Up to Rs.  5,00,000

NIL

Rs.  5,00,001 to Rs. 10,00,000

20% on income exceeding the limit of Rs. 5 lakh up to a maximum limit of Rs. 1 lakh

Rs. 10,00,001

30% on income exceeding  the limit of Rs. 10 lakh + Rs. 1 lakh

Add on components:

Surcharge: Applicable surcharge in case of income more than Rs. 50 lakhs and less than Rs. 1 crore would be 10% while surcharge for income, more than Rs. 1 crore would be 15% on the amount exceeding the limit of Rs. 1 crore.

Health and Education cess: now the Education and Secondary and Higher Education Cess would be replaced by “Health and Education Cess” at the rate of 4%, inclusive of all the surcharges.

  1. Bodies of Individuals, Association of Persons and other Artificial Judicial Persons:

A Body of Individuals (BoI) and an Association of Persons (AoP) is defined as per the Income Tax Act, 1961 is an association/integration of two or more individuals with the intention of making profits. These are one of the commonest examples of artificial judicial persons and are applicable to pay tax as per the below-given income tax slabs:

Income Threshold

Applicable tax rates on the income threshold 

Up to Rs.  2,50,000

Nil

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

5% on income exceeding the limit of Rs. Rs. 2.5 lakh up to a maximum limit of Rs. 12,500)

Rs.  5,00,001 to Rs.  10,00,000

20% on income exceeding the limit of Rs. 5 lakh up to a maximum limit of  Rs. 1 lakh + Rs. 12,500

Over Rs. 10,00,001

30% on income exceeding the limit of Rs. 10 lakh + Rs. 1 lakh + Rs. 12,500

Add on Components:

Surcharge: Applicable surcharge in case of income more than Rs. 50 lakhs and less than Rs. 1 crore would be 10% while surcharge for income, more than Rs. 1 crore would be 15% on the amount exceeding the limit of Rs. 1 crore.

Education Cess: Extra 2% tax rate is applicable to the income tax amount + applicable surcharge.

Higher Secondary & Higher Education Cess: Extra 1% tax rate is applicable to the income tax + surcharge for all taxpayers.

So, this was all about the income tax slab rates of the year 2019-2020. Stay tuned with us to get the latest tax rates updates.

The Author is an expert of income Tax related services, Click here to know more about him.

About Akash Kumar

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The author is Akash Kumar, working as Legal Associate with Enterslice Ites Private Limited, a Chartered Accountancy firm helping Startup & companies in setting up the business and complying with various tax laws applicable to Indian & foreign companies while establishing their business.

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