Tax slabs for FY 2008-09
Tax slabs for FY 2009-10
Tax slabs for FY 2011-12
Tax slabs for FY 2012-13
Tax slabs for FY 2013-14
When calculating the income tax liability each year, the first and foremost aspect which comes across one’s mind is the tax slabs. In this year’s annual budget, the government has brought about relief for the common man by widening this tax slab from the previous years. Here is a look into the slabs for the current financial year to help you prepare your investments and income, and to be able to file your tax returns accurately in the following assessment year.
Basic Tax Jargons
Financial Year, Assessment Year and Previous Year, do these commonly used income tax jargons often confuse you? This is what they mean.
- Financial Year (FY) – Duration of one year between 1st April to 31st March of the following year, in which all financial information are reported. The current financial year is 1st April 2010 to 31st March 2011.
- Assessment Year (AY) – The income of a particular financial year is assessed in the following financial year, which is known as the assessment year. For the current financial year, income will be assessed in the assessment year 2011-2012.
- Previous Year (PY) – The financial year preceding the assessment year, the income of which is assessed in the following assessment year. Assessment year 2011-2012 will assess income for previous year 2010-2011.
Income Tax Slabs
With the upward revision of the tax slabs, there would now be more savings for the consumers. Basic tax exemptions limits have been retained; however, the brackets have been broadened. Below are the income tax slabs and rates applicable for the current financial year 2010-11 and assessment year 2011-12.
Tax Slabs for Male Assesses(less than 65 years)
| Income: up to 1.6 lakhs | No Tax |
| Income : 1.6 lakhs to 5 lakhs | 10 % |
| Income : 5 lakhs to 8 lakhs | 20 % |
| Income : above 8 lakhs | 30 % |
Tax Slabs for Women Assesses (less than 65 years)
| Income : up to 1.9 lakhs | No Tax |
| Income : 1.9 lakhs to 5 lakhs | 10 % |
| Income : 5 lakhs to 8 lakhs | 20 % |
| Income : above 8 lakhs | 30 % |
Tax Slab for Senior Citizen
| Income : up to 2.4 lakhs | No Tax |
| Income : 2.4 lakhs to 5 lakhs | 10 % |
| Income : 5 lakhs to 8 lakhs | 20 % |
| Income : above 8 lakhs | 30 % |
As a result of the widening of the tax brackets, for an individual in the bracket between Rs. 3 Lakhs to Rs. 5 Lakhs, there could now be a saving of up to Rs. 20,000. Earlier, this bracket of 10% tax rate was applicable only up to an income of Rs. 3 Lakhs. Similarly, for the tax slab of Rs.8 Lakhs and above, there could now be a saving of more than Rs.50, 000.
Additionally, the government has also introduced section 80CCF where investments in infrastructure funds could fetch an extra deduction of Rs 20,000.
If you are looking for Income Tax Slab for FY 2011 – 2012 which was announced in budget 2011, click here.
5 Easy Steps to Calculate your Tax
Calculating income tax is not any rocket science. The following 5 steps give you an idea of the process.
- Calculate your gross total income. This includes gross income from Form 16; and the taxable income from other sources.
- Calculate your net deductions, which may include, donations, investments and savings such as provident fund subscriptions, Life Insurance Premiums etc.
- Your net taxable income is gross total income minus net deductions.
- Apply the appropriate income tax slab to calculate your tax payable on aggregate income.
- Education Cess of 3% is applied on the tax payable to arrive at the total tax payable. Relief under various sections would be applied on this total tax.
For example: Let us consider a net taxable income of Ravi as Rs. 8, 00,000.
As a male assessee, here’s how his tax is calculated.
Calculation
| Tax up to Rs. 1,60,000 | Nil |
| Tax on Rs.1,60,000 to Rs.5,00,000 @ 10% | 34,000 |
| Tax on Rs. 5,00,000 to Rs. 8,00,000 @ 20% | 60,000 |
| Total | 94,000 |
| Educational Cess - 3% of Total Tax | 2,820 |
| Net Tax Payable | 96,820 |
Find out your tax liability in less than 30 seconds using this tax calculator.
Want to know if you are saving and investing wisely? Use this calculator and find out. Click here to use other such calculators.
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