Income Tax Slab Rate Post Budget 2017


(Last Updated On: June 1, 2017)

Tax Slab 2017- 18

Are you still confused or in doubt about the tax slab of FY 2017-18 as per union budget?

It’s been a month since the union budget for FY  2017-18 was introduced. Although there weren’t any significant changes in the taxation policy.Here’s the easiest guide to show you the budget impact over your income in FY 2017-18.

Here are the few things to be taken into consideration:

  • Reduced tax rates from 10% to 5% 
  • Surcharge on individual having income more than Rs. 50 lakhs
  • Rebate under section 87A- reduced.

Here is detailed information of tax slab rate:

Individual Tax Slab

There is a relief in the taxation policy(both man and woman) for the segment earning more than Rs. 2,50,000 up to Rs. 5,00,000 per annum giving this section an extra benefit up to Rs. 12,500 per year.

INCOME(Rs.)F.Y. 2016-17F.Y. 2017-18 
Up to Rs 2,50,000No TaxNo Tax
Rs. 2,50,001 to 5,00,00010% 5%
Rs.5,00,001 to 10,00,00020% 20%
Above Rs. 10,00,00030%  30%
  • Those people who are earning an income of Rs. 3 lakhs can get their tax liability to zero
  • If you are getting  a benefit under sec 80C then merging it with the new proposal we can conclude that those whose tax liability is falling under category “Rs. 5,00,001 to 6,50,000” can reduce their tax liability by availing the benefit under section 80 C of Rs. 1,50,000 . Now he will fall under 5% category thereby saving 12,500 per year.

Senior Citizen Tax Slab

Slight change in policy for the segment earning between Rs. 3,00,000 to 5,00,000 giving them a benefit up to Rs. 10,000 a year.

INCOME(Rs.)F.Y. 2016-17F.Y. 2017-18 
Up to Rs 3,00,000No TaxNo Tax
Rs. 3,00,001 to 5,00,00010% 5%
Rs.5,00,001 to 10,00,00020% 20%
Above Rs. 10,00,00030%  30%


Super Senior Citizen Tax Slab

As per the budget, there is no change in taxation policy so normal rates are applicable.

INCOME(Rs.)F.Y. 2016-17F.Y. 2017-18
Up to Rs 5,00,000No TaxNo Tax
Rs.5,00,001 to 10,00,00020% 20%
Above Rs. 10,00,00030% 30%

NRI/HUF/AOP/BOI/AJP

INCOME(Rs.)F.Y. 2016-17F.Y. 2017-18
Up to Rs 2,50,000No TaxNo Tax
Rs. 2,50,001 to 5,00,00010%5%  
Rs. 5,00,001 to 10,00,00020%20%
Above Rs. 10,00,00030%30%

NOTE:
Surcharge: 
People who are earning a taxable income between Rs. 50 lakhs to  1 crore will have to pay a surcharge of 10% and if taxable income is above 1 crore, surcharge will be 15%.

Education Cess: 1% and 2% for secondary education and primary education respectively of total income tax and surcharge.

Cooperative Society-

As per the budget, there is no change in taxation policy so normal rates are applicable.

INCOME(Rs.)F.Y. 2016-17F.Y. 2017-18
Up to Rs 10,00010%10% 
Rs. 10,001 to 20,00020%20% 
Above Rs. 20,00030%30% 

NOTE:
Surcharge: 
People who are earning a taxable income exceeding Rs.1 crore will have to pay a surcharge of 12%.

Education Cess: 1% and 2% for secondary education and primary education respectively of total income tax and surcharge.

Firm/ Local authority

TAX RATESURCHARGEEDUCATION CESS
 30%12% if income is more than 1 crore.3% of total income tax and surcharge

Domestic company

TAX RATESURCHARGEEDUCATION CESS
 30%  7% if income exceeds 1 crore,  12% if income exceeds 10 crore.3% of total income tax and surcharge

Foreign company

TAX RATE  SURCHARGE EDUCATION CESS
 40% 2% if income exceeds
1 crore, 5% if income exceeds 10 crore.
3% of total income tax and surcharge

Change in Rebate

The existing rebate under Section 87A  amounting Rs. 5,000 for individuals earning up to Rs. 5 lakh has been reduced to Rs. 2500 for earning up to Rs. 3.5 lakh.

Let us understand this with an example:

Suppose Ram has an income of 5 lakhs and availing deduction under section 80C (1.5 Lakhs). His tax liability would be Rs. 5000 after giving benefit of  deduction and Basic Exemption Limit. Now under section 87A, rebate of Rs. 2500 will be given so after rebate tax liability would be Rs. 2500. Therefore, in this case Ram has saved net tax of INR 2,500.

FAQ’s

What is section 80C?

 Section 80C is a tax saving tool. You can claim deduction up to Rs. 1.5 lakh by investing or expending in the items specified in this section. Like LIC, Tuition fees, Principal repayment of housing loan etc.


What is section 87A?

Section 87A of the Act states that if an individual’s taxable income does not exceed Rs. 3.5 lakhs then the individual will get the benefit of Rs. 2500. Prior to the union budget 2017-18, it was on the taxable income up to INR 5 lakh and the benefit was of Rs. 5000.

What is education cess?

Education cess is implicated in order to fund the government funded education programs. The Primary Education cess is for primary schools and Secondary and Higher Education cess is for secondary schools. 


How much tax you were paying before and how can I calculate my total tax?

To know about the tax you were paying last year, you can follow this link. You can also calculate your tax liability here.

Where can I get an expert’s help?

You can Contact us for any expert help.

Author


Team Tax2Win