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India has become the fifth-largest economy in the world. As per this year’s economic survey, the economic growth is anticipated to get on track at a rate of 6%-6.5% in the financial year 2021-2022. Ample measures in especially three themes—Caring Society, Economic Development, and Aspirational India.
Below are the aspects that budget revolves around:
- Caring India: Under this theme, the FM envisions a humane and compassionate society.
- Economic Development:
- This theme extends the exhortation of the PM Modi—Sabka Saath, Sabka Vikas, Sabka Vishwas.
- Aspirational India:The theme intends to offer all the sections of the society with better standards of living, access to healthcare facilities, and employment opportunities.
What is the Revised Tax Slab?
The new budget has brought a revised tax slab as below:
|Tax Slab||Current Rate||New Rate|
|Rs 0-2.5 lakh||Exempt||Exempt|
|Rs 2.50-5 lakh||5%||5%|
|Rs 5-7.5 lakh||20%||10%|
|Rs 7.5-10 lakh||20%||15%|
|Rs 10-12.5 lakh||30%||20%|
|Rs 12.5-15 lakh||30%||25%|
|Rs 15 lakh and above||30%||30%|
Key Highlights of the Tax Slab:
- If your annual earning is about less than or equal to Rs. 2,50,000, then you have to pay 0% tax.
- If your annual earning is between Rs. 2,50,000 to Rs. 5,00,000, then you have to pay 5% of the total income.
- If your annual earning is between Rs. 5,00,000 to Rs. 7,50,000, then you have to pay 10% of the total income.
- If your annual earning is between Rs. 7,50,000 to Rs. 10,00,000, then you have to pay 15% of the total income.
- If your annual earning is between Rs. 10,00,000 to Rs. 12,50,000, then you have to pay 20% of the total income.
- If your annual earning is between Rs. 12,50,000 to Rs. 15,00,000, then you have to pay 25% of the total income.
- If your annual earning is exceeding Rs. 15,00,000, then you have to pay 30% of the total income.
Frequently Asked Questions About the Income Tax Slab
#1 Should I file income tax returns if my total income is less than Rs. 2,50,000?
A: Typically, you need not file an income tax returns (ITR) if your income is less than Rs. 2,50,000. However, it is always better to file ITR as ‘NIL Returns’, which will serve as a proof of employment for you.
#2 Is family pension taxed in the income tax returns?
A: No. You need not include family pension into your taxation income. Instead, you can mention family pension under the ‘income from other sources’ slab.
#3 Who is eligible to claim a rebate under the Section 87A?
A: Any resident of India, whose total income in a year is less than Rs. 5,00,000 can claim a rebate under Section 87A. The maximum rebate that you can claim is Rs. 12,500.
#4 How much income will be taxed for agriculturalist?
Any activity that is directly linked to the agriculture industry will not be taxed.
These were some of the insights regarding the tax slab for the financial year 2020-2021.
#budget #finances #Taxplanning #taximplication
Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of IndusGuru Network Partners