Income Tax Slab A.Y.2023-24 (F.Y.2022-23): Income tax slabs in India follow a progressive system: This means that as your income increases, the tax rates also increase. It ensures that individuals with higher incomes contribute more in taxes compared to those with lower incomes. The slabs are revised periodically, typically during each budget announcement: The income tax slabs are subject to change, and the government usually revises them during the annual budget announcement. It’s important to stay updated with the latest changes. In this article, we will provide a detailed discussion about the income tax slab for the assessment year (AY) 2023-24. We will cover various aspects such as changes and updates in the income tax slab, calculation of taxes based on the slab, specific slabs for salaried individuals and businesses, and more.
Table of contents
- Income Tax Slab (Old Tax Regime) A.Y. 2023-24
- Income Tax Slab (New Tax Regime) A.Y.2023-24
- Important Notes About Income Tax Slabs
- Age Criteria for A.Y. 2023-24
- What is Income Tax Slab
- What is Old Tax Regime and New Tax Regime AY 2023-24
- What is Financial Year & Assessment Year
- Key Points for Income Tax Slab A.Y.2023-24
Income Tax Slab (Old Tax Regime) A.Y. 2023-24
Income Tax Slab A.Y.2023-24 (F.Y.2022-23): Let’s explore the income tax slabs under the Old Tax Regime and the New Tax Regime for the assessment year (A.Y.) 2023-24. It is also called a regular tax regime. The regular tax regime is the default tax regime for the assessment year 2023-24. However, for the assessment year 2024-25, the default tax regime is the new tax regime. Therefore, individuals who prefer the old tax regime need to fill out Form 10IEA to exercise their options.
Income Tax Slab (Old Tax Regime) AY 2023-24 (Less Than 60 Years of Age)
Applicable To:
Assessee Type: Applicable to Resident Individual/NRI/HUF/AOP/BOI/AJP
Age: Less Than 60 Years on the last day of the previous Year (Date of birth on or after April 2, 1963)
Assessment Year: 2023-24
| Income Range | Income Tax Rates | Surcharge | Health and Education Cess |
| Up to ₹2,50,000 | Nil | Nil | Nil |
| ₹2,50,000 – ₹5 lakh | 5% of (total income minus ₹2,50,000) | Nil | 4% of Income Tax |
| ₹5 Lakh – ₹10 Lakh | ₹12,500 + 20% of (total income minus ₹5 Lakh) | Nil | 4% of Income Tax |
| ₹10 Lakh to ₹50 Lakh | ₹1,12,500 + 30% of (total income minus ₹10 Lakh) | Nil | 4% of Income Tax and Surcharge |
| ₹50 Lakh to ₹1 Crore | ₹13,12,500 + 30% of (total income minus ₹ 50 Lakh) | 10% of Income tax | 4% of Income Tax and Surcharge |
| ₹1 Crore to ₹2 Crores | ₹28,12,500 + 30% of (total income minus ₹ 1 Crore) | 15% of Income Tax | 4% of Income Tax and Surcharge |
| ₹2 Crores to ₹5 Crores | ₹58,12,500 + 30% of (total income minus ₹2 Crores) | 25% of Income Tax | 4% of Income Tax and Surcharge |
| Above ₹5 Crores | ₹1,48,12,500 + 30% of (total income minus ₹ 5 Crores) | 37% of Income Tax | 4% of Income tax and Surcharge |
Income Tax Slab (Old Tax Regime) AY 2023-24 (60 Years of Age or Above)
Applicable To:
Assessee Type: Applicable to Resident Individual
Age: 60 to 80 Years (Date of Birth on or after April 2, 1943, but before April 2, 1963)
Assessment Year: 2023-24
| Income Range | Income Tax Rates | Surcharge | Health and Education Cess |
| Up to ₹3,00,000 | Nil | Nil | Nil |
| ₹3,50,000 – ₹5 lakh | 5% of (total income minus ₹3,00,000) | Nil | 4% of Income Tax |
| ₹5 Lakh – ₹10 Lakh | ₹10,000 + 20% of (total income minus ₹5 Lakh) | Nil | 4% of Income Tax |
| ₹10 Lakh to ₹50 Lakh | ₹1,10,000 + 30% of (total income minus ₹10 Lakh) | Nil | 4% of Income Tax and Surcharge |
| ₹50 Lakh to ₹1 Crore | ₹13,10,000 + 30% of (total income minus ₹ 50 Lakh) | 10% of Income tax | 4% of Income Tax and Surcharge |
| ₹1 Crore to ₹2 Crores | ₹28,10,000 + 30% of (total income minus ₹ 1 Crore) | 15% of Income Tax | 4% of Income Tax and Surcharge |
| ₹2 Crores to ₹5 Crores | ₹58,10,000 + 30% of (total income minus ₹2 Crores) | 25% of Income Tax | 4% of Income Tax and Surcharge |
| Above ₹5 Crores | ₹1,48,10,000 + 30% of (total income minus ₹ 5 Crores) | 37% of Income Tax | 4% of Income tax and Surcharge |
Income Tax Slab (Old Tax Regime) AY 2023-24 (80 Years of Age or Above)
Applicable To:
Assessee Type: Applicable to Resident Individual
Age: 80 Years or Above (Date of Birth before April 2, 1943)
Assessment Year: 2023-24
| Income Range | Income Tax Rates | Surcharge | Health and Education Cess |
| Up to ₹5 Lakh | Nil | Nil | Nil |
| ₹5 Lakh – ₹10 Lakh | 20% of (total income minus ₹5 Lakh) | Nil | 4% of Income Tax |
| ₹10 Lakh to ₹50 Lakh | ₹1,00,000 + 30% of (total income minus ₹10 Lakh) | Nil | 4% of Income Tax and Surcharge |
| ₹50 Lakh to ₹1 Crore | ₹13,00,000 + 30% of (total income minus ₹ 50 Lakh) | 10% of Income tax | 4% of Income Tax and Surcharge |
| ₹1 Crore to ₹2 Crores | ₹28,00,000 + 30% of (total income minus ₹ 1 Crore) | 15% of Income Tax | 4% of Income Tax and Surcharge |
| ₹2 Crores to ₹5 Crores | ₹58,00,000 + 30% of (total income minus ₹2 Crores) | 25% of Income Tax | 4% of Income Tax and Surcharge |
| Above ₹5 Crores | ₹1,48,00,000 + 30% of (total income minus ₹ 5 Crores) | 37% of Income Tax | 4% of Income tax and Surcharge |
Income Tax Slab (New Tax Regime) A.Y.2023-24
Income tax slabs for AY 2023-24 under the new tax regime: This table presents the income tax slabs, income ranges, and the corresponding tax rates applicable for AY 2023-24 under the new tax regime. It provides a clear overview of the tax rates that individuals will be subject to based on their income levels. Here are the updated income tax slabs and rates applicable for AY 2023- b 24 under the new tax regime:
HUFs and individuals interested in opting for the new tax regime for the Assessment Year 2023-24 are advised to use Form 10IE.
Income Tax Slab (Old Tax Regime) AY 2023-24 (For All Ages)
Applicable To:
Assessee Type: Applicable to Resident Individual/NRI/HUF/AOP/BOI/AJP
Age: For All Age Group
Assessment Year: 2023-24
| Income | Tax Rates |
|---|---|
| Up to Rs 2,50,000 | Nil |
| Rs 2,50,000 to Rs 5,00,000 | 5% of (total income – Rs 2,50,000) |
| Rs 5,00,000 to Rs 7,50,000 | Rs 12,500 + 10% of (total income – Rs 5,00,000) |
| Rs 7,50,000 to Rs 10,00,000 | Rs 37,500 + 15% of (total income – Rs 7,50,000) |
| Rs 10,00,000 to Rs 12,50,000 | Rs 75,000 + 20% of (total income – Rs 10,00,000) |
| Rs 12,50,000 to Rs 15,00,000 | Rs 1,25,000 + 25% of (total income – Rs 12,50,000) |
| Above Rs 15,00,000 | Rs 1,87,500 + 30% of (total income – Rs 15,00,000) |
These income tax slabs and rates are applicable for AY 2023-24 and are specific to the new tax regime. Individuals have the choice to assess their tax liability and decide whether to opt for the new tax regime or continue with the old tax regime based on their financial circumstances and potential tax savings.
Important Notes About Income Tax Slabs
1. Rebate Under Section 87A (A.Y.2023-24)
Please note that the rebate under Section 87A is available to resident individuals whose total income does not exceed Rs. 500,000. They are eligible for a rebate of up to Rs. 12,500. However, certain special incomes are not eligible for this rebate as mentioned in Paragraph 6. Additionally, the rebate is applicable even if the assessee has opted for the alternative tax regime.
2. Surcharge AY 2023-24
Surcharge is an additional charge imposed on individuals earning income above specified limits. It is calculated based on the amount of income tax determined using applicable rates. The surcharge rates for different income brackets are as follows:
– 10%: Applicable to taxable income above ₹50 lakh up to ₹1 crore
– 15%: Applicable to taxable income above ₹1 crore up to ₹2 crore
– 25%: Applicable to taxable income above ₹2 crore up to ₹5 crore
– 37%: Applicable to taxable income above ₹5 crore
The maximum surcharge rate on income from dividends or income under Sections 111A, 112, and 112A is 15%.
3. Marginal Relief for A.Y. 2023-24
– The surcharge is subject to marginal relief.
– If the net income exceeds Rs. 50 Lakh:
– The amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 50 Lakh by more than the amount of income that exceeds Rs. 50 Lakh.
– If the net income is in the range of Rs. 1 crore – Rs. 2 crores:
– The amount payable as income-tax and surcharge shall not exceed the income that exceeds Rs. 1 crore.
– If the net income is in the range of Rs. 2 crores to Rs. 5 crores:
– The amount payable as income-tax and surcharge shall not exceed the amount payable as income-tax and surcharge on total income of Rs. 2 crores by more than the amount of income that exceeds Rs. 2 crores.
– If the net income is above Rs. 5 crores:
– The amount payable as income-tax and surcharge shall not exceed the total amount payable as income-tax and surcharge on total income of Rs. 5 crores by more than the amount of income that exceeds Rs. 5 crores.
Age Criteria for A.Y. 2023-24
Please note that the CBDT has clarified that for individuals born on 1st April, their age is considered to be attained on 31st March of the preceding year. The categorization of senior/very senior citizens is determined based on the individual’s date of birth as follows:
The table provides an overview of the categorization of individuals based on age for determining their eligibility as senior citizens or super senior citizens. The definitions and age criteria are provided by the CBDT (Central Board of Direct Taxes).
| Category | Age Range | Date of Birth |
|---|---|---|
| Super Senior Citizen | 80 years or more | Born on or before 1st April 1943 |
| Senior Citizen | 60 years or more but less than 80 years | Born between 2nd April 1943 and 1st April 1963 |
| Others | Below 60 years | Born on or after 2nd April 1963 |
Please note that the CBDT has clarified that for individuals born on 1st April, their age is considered to be attained on 31st March of the preceding year. The categorization of senior/very senior citizens is determined based on the individual’s date of birth as follows:
What is Income Tax Slab
1. Progressive Taxation: Income tax slabs follow a progressive tax system, where tax rates increase as income levels rise. This ensures that individuals with higher incomes contribute a higher proportion of their earnings as taxes.
2. Categorization based on Income: Taxpayers are grouped into different income brackets or slabs based on their annual income. Each slab has a specific tax rate applicable to it.
3. Revisions and Updates: Income tax slabs can be revised and updated periodically, usually during the annual budget announcement. Changes may involve adjustments to tax rates, thresholds, or exemptions.
4. Deductions and Exemptions: Certain deductions, exemptions, and allowances provided by the government can lower the taxable income and reduce the overall tax liability for individuals falling within specific income slabs.
5. Different Slabs for Different Categories: The income tax slabs may vary based on the taxpayer’s category, such as individuals, senior citizens, or businesses. Each category may have distinct slab rates and income thresholds.
6. Assessment Year and Financial Year: The income tax slabs are applicable for a specific financial year, and the taxes are calculated and paid in the subsequent assessment year when the income tax returns are filed.
7. Choosing Tax Regime: Taxpayers have the option to choose between different tax regimes, such as the old regime or the new regime. Each regime has its own set of income tax slabs, deductions, and exemptions.
8. Regular Updates: It is important for taxpayers to stay updated with the latest income tax slab rates, amendments, and any changes announced by the government to ensure accurate tax planning and compliance.
What is Old Tax Regime and New Tax Regime AY 2023-24
The government offers taxpayers the flexibility to choose between two tax regimes: the Old Tax Regime and the New Tax Regime. You have the freedom to choose the tax regime that works best for you. The government gives you this option so that you can select the regime that results in a lower tax liability based on your specific financial situation. You can analyze your circumstances, including the impact of deductions and exemptions, and decide which regime will help you minimize your tax burden.
Under the Old Tax Regime ay 2023-24, you have the option to calculate your taxes by considering various deductions, exemptions, and allowances available under the Income Tax Act. These can include deductions for things like housing loan interest, medical expenses, education loan interest, and more. By taking advantage of these deductions, you can reduce your taxable income and, ultimately, lower your overall tax liability.
On the other hand, the New Tax Regime ay 2023-24 simplifies things a bit. It offers lower tax rates compared to the Old Tax Regime, but it eliminates most deductions and exemptions. With the New Tax Regime, you don’t need to worry about calculating and claiming these deductions. Instead, you pay tax based on the prescribed tax rates for different income slabs, without considering any deductions.
| Aspect | Old Tax Regime A.Y. 2023-24 | New Tax Regime A.Y.2023-24 |
|---|---|---|
| Considerations | Allows deductions, exemptions, and allowances | Does not consider most deductions and exemptions |
| Tax Calculation | Tax calculated after considering eligible deductions | Tax calculated based on prescribed tax rates without deductions |
| Tax Rates | Higher tax rates compared to the New Tax Regime | Lower tax rates compared to the Old Tax Regime |
| Complexity | More complex due to the need to compute and claim deductions | Simpler as most deductions and exemptions are not considered |
You have the freedom to choose the tax regime that works best for you. The government gives you this option so that you can select the regime that results in a lower tax liability based on your specific financial situation. You can analyze your circumstances, including the impact of deductions and exemptions, and decide which regime will help you minimize your tax burden.
What is Financial Year & Assessment Year
It is important to have a clear understanding of what a financial year and an assessment year represent.
Financial Year 2022-23: This refers to the period from April 1, 2022, to March 31, 2023. It is the year during which you earn your income and incur expenses.
Assessment Year 2023-24: This is the year in which you file your income tax returns for the financial year 2022-23. It’s the year when the government assesses your income and determines the amount of tax you need to pay.
Example to Understand Financial Year and Assessment Year
Ram’s salary income for the financial year 2022-23 (April 1, 2022, to March 31, 2023) is Rs. 8,00,000. During this financial year, he received his salary from his employer, and it is the period when he earned his income and incurred expenses.
Now, Ram needs to file his income tax returns for the assessment year 2023-24. The assessment year is the year following the financial year in which the income is assessed for tax purposes. In this case, Ram will file his income tax returns for the financial year 2022-23 (April 1, 2022, to March 31, 2023) in the assessment year 2023-24.
Key Points for Income Tax Slab A.Y.2023-24
1. Income tax slabs in India follow a progressive system, where tax rates increase as income levels rise.
2. The income tax slabs are revised periodically, usually during the annual budget announcement.
3. It is important to stay updated with the latest changes in the income tax slab.
4. This article provides a detailed discussion about the income tax slab for AY 2023-24.
5. The article covers changes and updates in the income tax slab, calculation of taxes based on the slab, and specific slabs for salaried individuals and businesses.
6. Examples and illustrations are included to clarify concepts and aid understanding.
7. The importance of staying updated with official announcements or changes made by the government regarding the income tax slab is emphasized.
8. By the end of the article, readers will have a comprehensive understanding of the income tax slab for AY 2023-24.
9. The information provided will assist taxpayers in fulfilling their tax obligations and making informed financial decisions.