Income Tax Slab & Rate for FY2018-19, 17-18 & 16-17
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- 08 Feb 2023
Summary
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Income tax slabs for FY 2018-19 remain mostly the same as the previous financial year.
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Health and Education Cess increased to 4% from 3% in the previous year.
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A standard deduction of Rs.40,000 can be claimed for transportation and/or medical reimbursements from Financial Year 2018-19.
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The Finance Ministry in the Union Budget for 2018 announced the insertion of Section 80TTB which will govern the tax benefits for senior citizens. We have covered the revised tax benefits later in this article.
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For domestic companies, the turnover limit for 25% taxation bracket was increased to Rs.250 crore from Rs. 50 crore in the previous financial year (FY2017-18).
Introduction To Income Tax Slabs
The amount of tax (as a percentage of your income) you must pay is determined by your tax slab. This is applicable for different types of taxpayers -- resident individuals, non-resident individuals, Hindu Undivided Families, associations of people, firms, domestic and foreign companies.
These tax rates are subject to change based proposals in the Union Budget every year. Indian has a progressive tax system based on ‘ability to pay’ – the tax percentage increases incrementally with income. So, the poor pay less or no tax under such a system, while the affluent pay higher taxes.
Read more: Income Tax slabs in India
Income Tax Slabs Rates For FY2018-19 (AY 2019-20)
Tax slabs for FY 2018-19 remain the same as the previous year (FY 2017-18). Some changes that have been incorporated in FY 2018-19 are:
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The 3% Education Cess levied in FY18 has been increased to 4% and is called the Health and Education Cess.
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A standard deduction of Rs.40,000 can be claimed for transportation and/or medical reimbursements from FY18.
Income Tax Slabs For Individual Tax Payers & HUF
| Income | Tax rate |
|---|---|
Up to Rs. 2.5 lakh | Nil |
Rs.2.5 lakh to 5 lakh | 5% |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 4% of income tax(for income above Rs. 2.5 lakh) |
Surcharge* | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Surcharge levied should not exceed the amount of income tax payable.
Income Tax Slabs For Senior Citizens (Over 60 Years But Below 80) For FY 2018-19 – Part II
For senior citizens, the income tax exemption limit is up to Rs. 3 lakh, as per the FY 2018-19 tax slabs.
| Income | Tax rate |
|---|---|
Up to Rs. 3 lakh | Nil |
Rs.3 lakh to 5 lakh | 5% |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 4% of income tax(for income above Rs. 3 lakh) |
Surcharge | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Super Senior Citizens (Over 80 Years) For FY 2018-19 – Part III
For Super Senior Citizens, total income up to Rs.5 lakh is tax exempt for FY 2018-19.
| Income | Tax rate |
|---|---|
Up to Rs.5 lakh | Nil |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 4% of income tax(for income above Rs. 5 lakh) |
Surcharge | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Domestic Companies For FY 2018-19 – Part IV
In the Union Budget for FY 2018-19, the turn over limit for 25% taxation bracket was increased to Rs.250 crore from Rs. 50 crore in the previous year.
| Turn over | Tax rate |
|---|---|
Gross turn over < Rs.250 crore | 25% |
Gross turn over > Rs. 250 crore | 30% |
Cess | 4% of corporate tax |
Surcharge | 7% of income tax (For total income between Rs.1 crore and Rs.10 crore) 12% of income tax (For income above Rs.10 crore) |
Income Tax Slabs Rates for Previous Years
Income Tax Slabs Rates For FY 2017-18 (AY 2018-19)
Income Tax Slabs For Individual Tax Payers & HUF
In FY 2017-18, the tax rate for income between Rs.2.5 lakh and Rs.5 lakh was reduced to 5% from 10% in FY 2016-17. An additional surcharge of 10% was levied for those with total income exceeding Rs.50 lakh but less than Rs. 1 crore.
| Income | Tax rate | Health & Education Cess |
|---|---|---|
Up to Rs. 2.5 lakh | Nil | Nil |
Rs.2.5 lakh to 5 lakh | 5% | 3% |
Rs. 5 lakh to Rs. 10 lakh | 20% | 4% |
Rs. 10 lakh and above | 30% | 4% |
Surcharge* | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Senior Citizens (Over 60 Years But Under 80) For FY 2017-18 – Part II
| Income | Tax rate |
|---|---|
Up to Rs. 3 lakh | Nil |
Rs.3 lakh to 5 lakh | 5% |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 3% of income tax(for income above Rs. 3 lakh) |
Surcharge | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Super Senior Citizens (Above 80 Years)
| Income | Tax rate |
|---|---|
Up to Rs.5 lakh | Nil |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 3% of income tax(for income above Rs. 5 lakh) |
Surcharge | 10% of income tax (For total income between Rs.50 lakh and Rs. 1 crore) 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Domestic Companies For FY
| Turn over | Tax rate |
|---|---|
Gross turn over < Rs.50 crore | 25% |
Gross turn over > Rs. 50 crore | 30% |
Cess | 3% of corporate tax |
Surcharge | 7% of income tax (For total income between Rs.1 crore and Rs.10 crore) 12% of income tax (For income above Rs.10 crore) |
Income Tax Slabs For Individual Tax Payers & HUF
| Income | Tax rate |
|---|---|
Up to Rs. 2.5 lakh | Nil |
Rs.2.5 lakh to 5 lakh | 10% |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 3% of income tax(for income above Rs. 2.5 lakh) |
Surcharge | 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Senior Citizens (Over 60 But Below 80 Years) For FY 2016-17 – Part IIF
| Income | Tax rate |
|---|---|
Up to Rs. 3 lakh | Nil |
Rs.3 lakh to 5 lakh | 10% |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 3% of income tax(for income above Rs. 3 lakh) |
Surcharge | 15% of income tax (For income above Rs. 1 crore) |
Income Tax Slabs For Senior Citizens (Over 80 Years Of Age) For FY 2016-17 – Part III
| Income | Tax rate |
|---|---|
Up to Rs.5 lakh | Nil |
Rs. 5 lakh to Rs. 10 lakh | 20% |
Rs. 10 lakh and above | 30% |
Education and Health Cess | 3% of income tax(for income above Rs. 5 lakh) |
Surcharge | 15% of income tax (For income above Rs. 1 crore) |
IT Slabs For Domestic Companies For FY
| Turn over | Tax rate |
|---|---|
Gross turn over in FY 2014-15 < Rs.5 crore | 29% |
Gross turn over in FY 2014-15 > Rs. 5 crore | 30% |
Cess | 3% of corporate tax |
Surcharge | 7% of income tax (For total income between Rs.1 crore and Rs.10 crore) 12% of income tax (For income above Rs.10 crore) |
FAQS About Income Tax Slabs
It is a period of 12 months that is considered for all tax and accounting purposes. In many countries, the financial year differs from the calendar year. For example, In India, the financial year runs from 1st April of the current calendar year to 31st March of the following calendar year. So, Financial Year 2017-2018 would run from 1st April 2017 to 31st March 2018.
An assessment year follows the financial year beginning in April. After paying the taxes in the fiscal year, you file your tax returns in the assessment year and they are examined for refund claims and other dues in the same assessment year. For example, for the income earned in Financial Year 2017-18, the Assessment year would be called AY 2018-2019 beginning April 1st, 2018.
Cess is a temporary tax levied by the government to raise money from the taxpayers for specific policies. For example, taxpayers earning above Rs. 2.5 lakh per annum have to pay an Education and Health Cess of 4%. For super senior citizens, the cess applies for income above Rs.5 lac.
It is the charges you pay over and above your current income tax to the central government. The purpose of imposing a surcharge is to make the taxation progressive, that is, the wealthy individuals should pay more than those with lower income. Individuals with an income exceeding Rs. 50 lakh but less than Rs.1 crore currently pay a surcharge of 10% and those exceeding Rs 1 crore pay 15% on the net income tax.
Finance Minister Arun Jaitley announced a few key changes in the tax benefits for senior and super senior taxpayers in the 2018 Union Budget for FY 2018-19.
Increase in the tax exemption limit
- Section 80TTB was inserted to govern the tax benefits awarded to senior citizens. Under this, the exemption limit on the interest income earned on bank savings, FD and recurring deposits and post office deposits was increased to the tune of Rs.50,000 from the earlier limit of Rs.10,000. Interest income above Rs.50,000 will be taxed according to applicable tax slabs.
No TDS on interest income
- No TDS will be deducted for the income earned from the above sources for senior citizens by the bank. Thus, senior citizens will not have to furnish Form 15H to stop TDS from being deducted, if their total income is not taxable.
Higher deduction for health insurance premium
- Tax deduction on health insurance premium increased to Rs.50,000 from Rs.30,000 earlier. The benefit will also apply to the taxpayer paying the premium on behalf of dependents who are senior citizens.
Tax deduction for medical expenditure increased to Rs.1. Lakh
- Under section 80DDB, the ceiling for deduction on medical expenditure for specific illnesses has been increased to Rs 1 lakh against the previous limits of Rs.60,000 (for senior citizens) and Rs.80,000 (for super senior citizens). The critical illnesses include neurological disorders, malignant cancer, AIDS, chronic renal failure, and haematological disorders. The prescriptions should be issued by qualified MDs and field experts. If the patient took the treatment in a government-run hospital, then the prescription from a full-time specialist will do. Also, this exemption is over and above the deduction of Rs.1.5 lakh under Section 80C.
Rs.40,000 standard deduction on pension income
- Senior citizens can claim a standard deduction of Rs.40,000 on their pension income.
