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Budget 2020: New Income Tax Slab for an Individual Taxpayer for FY 2020-21 (AY 2021-22)

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New Income Tax Slab Rates for F.Y 2020-21 | A.Y 2021-22

Budget 2020: FM Nirmala Sitharaman today proposed new income tax slabs and lower tax rates for F.Y 2020-21 | A.Y 2021-22. Lower income tax rates are optional and are available to those who are willing to forego some exemptions and some deductions. The new income tax rates will be significantly reduced for those who forego reliefs, exemptions, the finance minister said.

INCOME TAX SLAB RATES FOR INDIVIDUAL ASSESSEE

Option 1 -OLD TAX REGIME with deductions & exemptions:
For Non-Senior Citizen (Age – less than 60 years)

An Individual whether an Indian resident or non-resident Indian who is less than 60 years of age will be considered as Non-Senior Citizen and would be taxed at the following rates depending upon the slabs of income.

Income Tax Slabs Tax rate
Upto Rs. 2.5 lakh Nil
2.5 lakh to 5 lakh 5%
5 lakh to 10 lakh 20%
Above 10 lakh 30%

Option 2 -NEW TAX REGIME with no deductions no exemptions:
For Non-Senior Citizen (Age – less than 60 years)

An Individual whether an Indian resident or non-resident Indian who is less than 60 years of age will be considered as Non-Senior Citizen and would be taxed at the following rates depending upon the slabs of income.

Income Slabs Tax rate
Upto Rs. 2.5 lakh Nil
2.5 lakh to 5 lakh 5%
5 lakh to 7.5 lakh 10%
7.5 lakh to 10 lakh 15%
10 lakh to 12.5 lakh 20%
12.5 lakh to 15 lakh 25%
Above 15 lakh 30%

These new income tax related proposals will come into effect from the assessment year 2021-22 or financial year 2020-21.

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