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Business News/ Budget 2019 / News/  Income tax rates for 2019-20 after interim budget  
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Income tax rates for FY 2019-20 after interim budget

In the next FY 2019-20, a tax rebate has been given to only those who fall in the Rs. 5 lakh income slab
  • Together with the increase in the standard deduction, the total tax saving comes up to Rs. 13,520 for someone in the Rs. 5 lakh bracket
  • For salaried persons, standard deduction has been raised from the current ₹40,000 to ₹50,000 for FY 2019-20 in the interim budget.Premium
    For salaried persons, standard deduction has been raised from the current 40,000 to 50,000 for FY 2019-20 in the interim budget.

    NEW DELHI : In the interim budget, finance minister Piyush Goyal has not changed the income tax slabs for the financial year 2019-20 but has provided relief to middle-class salaried taxpayers by rebates and increasing the standard deduction threshold.

    Clause 8 of the Finance Bill introduced in parliament on Friday seeks to amend section 87A of the Income Tax Act to provide relief to individual taxpayers by allowing a rebate on annual income of up to 5 lakh.

    For salaried persons, standard deduction has been raised from the current 40,000 to 50,000. This will provide an additional tax benefit of 4,700 crore to more than 3 crore salary earners and pensioners.

    In the ongoing 2018-19, income up to 2.5 lakh is not taxable for individuals below the age of 60. Those above 60 years but less than 80 years enjoy a tax-free income of up to 3 lakh while for those above 80 the tax-free income goes up to 5 lakh.

    According to the current slabs, if total income is more than 2.5 lakh but up to 5 lakh, then the total tax outgo is 5% of the amount by which the total income exceeds 2.5 lakh. For income between 5 lakh and 10 lakh, the tax outgo is 20% of the amount by which the total income exceeds 5 lakh plus 12,500.

    In the 2019-20, a rebate has been given to only those who fall in the 5 lakh slab. Together with the increase in the standard deduction, the total tax saving is 13,520.

    Income tax rates for individuals below 60 years:

    Net Income after 80C deduction Tax Benefit
    AY 2019-20 AY 2020-21 AY 2019-20 AY 2020-21
    Net Income Increase in Standard Deduction Net Income
    5,10,000 10,000 5,00,000 13,520 - 13,520
    10,60,000 10,000 10,50,000 1,35,720 1,32,600 3,120
    58,10,000 10,000 58,00,000 17,79,492 17,76,060 3,432
    1,08,10,000 10,000 1,08,00,000 36,54,378 36,50,790 3,588


    Income tax rates for senior citizens:

    Resident Individual who is a senior citizen
    Pre -Budget
    Net Taxable Income (after deductions) 300,000 350,000 400,000 500,000 1,000,000
    Tax - 2,500 5,000 10,000 110,000
    Rebate - 2,500 - - -
    Balance Tax - - 5,000 10,000 110,000
    Cess - - 200 400 4,400
    Total - - 5,200 10,400 114,000


    Post -Budget
    Net Taxable Income (after deductions) 300,000 350,000 400,000 500,000 1,000,000
    Tax - 2,500 5,000 10,000 110,000
    Rebate - 2,500 5,000 10,000 -
    Balance Tax - - - - 110,000
    Cess - - - - 4,400
    Total - - - - 114,000
    Saving - - 5,200 10,400 -

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    Published: 04 Feb 2019, 05:02 PM IST
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