In India, income tax is levied on individual taxpayers on the basis of a slab system where different tax rates have been prescribed for different slabs and such tax rates keep increasing with an increase in the income slab.
Income Tax Slab Rate for AY 2020-21 for Individuals:
1.1 Individuals (below the age of 60 years), which includes residents as well as non-residents
| NET PROFIT | Income-Tax rate |
| Up to Rs. 2,50,000 | Nil |
| Rs. 2,50,000- Rs. 5,00,000 | 5% |
| Rs. 5,00,000- Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
1.2 Resident senior citizens (60 years and above but below the age of 80 years)
| NET PROFIT | Income-Tax rate |
| Up to Rs. 3,00,000 | Nil |
| Rs. 3,00,000 – Rs. 5,00,000 | 5% |
| Rs. 5,00,000- Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
1.3 Resident super senior citizens (above 80 years of age)
| NET PROFIT | Income-Tax rate |
| Up to Rs. 5,00,000 | Nil |
| Rs. 5,00,000- Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
2. Income Tax Rates For HUF/AOP/BOI/Any other Artificial Juridical Person:
| NET PROFIT | Income-Tax rate |
| Up to Rs. 2,50,000 | Nil |
| Rs. 2,50,000- Rs. 5,00,000 | 5% |
| Rs. 5,00,000- Rs. 10,00,000 | 20% |
| Above Rs. 10,00,000 | 30% |
Health and Education: – 4% of income tax and surcharge.Surcharge: – 10% of income tax where total income exceeds Rs. 50,00,000.
15% of income tax where total income exceeds Rs. 1,00,00,000.
3. Tax Rate for Companies
| Particulars | Tax rates |
| Total turnover or gross receipts during the previous year 2017-18 doesn’t exceed Rs. 250 Crore | 25% |
| Other domestic companies | 30% |
| Tax Rate of foreign company | 40% |
Surcharge:
| Company | Net income is between Rs. 1Cr. – 10 Cr. | Net income exceeds Rs. 10Cr. |
| Domestic company | 7% | 12% |
| Foreign company | 2% | 5% |
4. Income Tax Slab Rate for Local Authority: A local authority is taxable at 30%. Health and Education: 4% of income tax plus surcharge. Surcharge: 12% of tax where total income exceeds Rs. 1 crore.
5. Income Tax Rate for Partnership Firm: A partnership firm (including LLP) is taxable at 30%. Health and Education: 4% of income tax plus surcharge. Surcharge: 12% of tax where total income exceeds Rs. 1 crore.
Income Tax Slab Rate for Co-operative Society:
| NET PROFIT | Income-Tax rate |
| Up to Rs. 10,000 | 10% |
| Rs. 10,000 to Rs. 20,000 | 20% |
| Above Rs. 20,000 | 30% |
Health and Education: 4% of income tax plus surcharge. Surcharge: 12% of tax where total income exceeds Rs. 1 crore.