Income Tax Slabs FY 2023-24

The Income Tax Slab is defined as a category based on which individual taxpayers need to pay the income tax. It is based on the slab system they fall as per their earning. Higher is the income, higher will be the income tax slab. The aim of introducing income tax slab system in India is to maintain a fair tax system in the country. These slabs tend to revised at every union budget announcement.

New Regime Income Tax Slab rates for individual :

Income Tax Slab Tax Rate
Up to Rs 3 Lakh NIL
Above Rs 3 Lakh- 6 Lakh 5% of total income
Above Rs 6 Lakh- 9 Lakh 10% of total income
Above Rs 9 Lakh-12 Lakh 15% of total income
Above Rs 12 Lakh-15 Lakh 20% of total income
Above Rs 15 Lakh 30% of total income

Income Tax Slab between 60-80 years :

Income Tax Slab Tax Rate
Up to Rs 3 Lakh NIL
Above Rs.3.00 lakh - Rs.5.00 lakh 5% of the total income that is more than Rs.3 lakh + 4% cess
Above Rs.5.00 lakh - Rs.10 lakh 20% of the total income that is more than Rs.5 lakh + Rs.10,500 + 4% cess
Above Rs.10 lakh 30% of the total income that is more than Rs.10 lakh + Rs.1,10,000 + 4% cess

Things to keep in mind while choosing New Income Tax Slab :

  • You can choose this option on or before previous financial year, if you as an individual or as a member of a Hindu Undivided Family do not have any business income.
  • As a taxpayer, once you choose the next tax regime as your option, you cannot change it during the year. In case you withdraw your option for the next tax regime and revert to the old tax regime, you can opt for the new tax regime during the financial year again.

When to choose between New and Old Tax Regime :

Type of Income Which one to choose between new and old tax regimes
Salary income or any other type of income that triggers TDS An employee can opt for the new tax regime at the beginning of financial year. However, once chosen they cannot revert back to the old regime and can only change the option of selecting the tax regime at the beginning of the new financial year
Income from Profession and Business In case of income from profession and business, the option to choose between the tax regimes is available only once.

For Domestic Companies, The Tax-Slabs Depends on Turnover as Mentioned Below: :

Turnover Tax Rate
Gross turnover can be a maximum of Rs.250 crore for the previous year 25%
Gross turnover is more than Rs.250 for the previous year 30%

Surcharge Rates applicable to Income Tax For Assessment Year 2023-24 :

Income Range Applicable Surcharge Rates
Up to Rs.50 lakh 10%
Above Rs.50 lakhs to Rs.1 crore 15%
Above Rs.1 crore to Rs.2 crore 25%
Above Rs.2 crore to Rs.5 crore 37%
More than Rs.5 crore 37%

New Income Tax Slab Rates for Domestic Companies :

Type Old Tax Rates New Tax Rates
Company chooses section 115BAB and is registered on or after 1 October 2019 and has commenced manufacturing on or before 31 March, 2023. - 15%
Company chooses Section 115BAA, wherein the total income of a company has been calculated where specified deductions, incentives, exemptions and additional depreciation have not been claimed. - 22%
Company chooses section 115BA registered on or after 1 March 2023 and are engaged in manufacture of any item and no deduction claim as specified in the section clause has been made. - 25%
If a company’s turnover is less than Rs. 400 crores in the previous financial year. 25% 25%
Any other domestic company 30% 30%

This year, the finance minister Nirmala Sitharaman has announced the Union Budget for 2023 on 1 February 2023. In the latest budget, certain changes to the existing income tax slab has been introduced.

The finance minister announced that under the new tax regime the rebate for income tax has been increased to Rs.7 lakh from the earlier limit of up to Rs.5 lakh. There were certain changes under the tax slab for the new tax regime too. Apart from that surcharge rate on income of Rs.5 crore and above has been decreased from 37% to 25%.

Note: You can now file your taxes through the New income tax portal. The new portal comes with a plethora of features and is designed to ease the tax filing process.

Frequently Asked Questions

  • Am I eligible for paying tax, in case, my annual income is less than Rs 3 Lakh?
    No, if your annual earnings are less than Rs 3 Lakh, as per the new regime, you should file ‘Nil Return’. For instance, you can provide your ITR while applying for a loan or passport.
  • How to classify the income of a taxpayer?
    Under Section 14 of the Income Tax Act, the taxpayer's income has been classified under 5 different income heads such as Salaries individuals, Income from house property,Capital gains, Gains/Profits from profession or business Income from other sources.
  • How to claim rebate under Section 87A?
    Rebate under Section 87A can be claimed by any resident Indian whose total annual income up to Rs.7 lakh as per the new regime.
  • Does family pension come under salary income during taxation?
    No, family pension will not be taxed under salary income but as 'income from other sources.'
  • Is income up to Rs.5 lakh tax-free?
    No, income up to Rs.5 lakh is taxable.
  • Are the income tax slabs in India subject to change?
    Yes, the income tax slabs in India are subject to changes.
  • When are the changes to the income tax slabs in India proposed?
    The changes to the income tax slabs in India are announced by the finance minister of the country. This proposal is usually made when the annual budget is announced every year in the month of February.