Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
The slabs
- Up to ₹4 lakh — nil
- ₹4–8 lakh — 5%
- ₹8–12 lakh — 10%
- ₹12–16 lakh — 15%
- ₹16–20 lakh — 20%
- ₹20–24 lakh — 25%
- Above ₹24 lakh — 30%
Effectively zero up to 12 lakh
The Section 87A rebate removes the tax on income up to ₹12 lakh; for salaried people the ₹75,000 standard deduction lifts the break-even to about ₹12.75 lakh of salary. Confirm per the current Finance Act.
Reading the slabs with the rebate and surcharge
Two things shape what you actually pay on these slabs. First, the Section 87A rebate: although the slabs start taxing from ₹4 lakh, a resident with taxable income up to ₹12 lakh pays nothing, because the rebate cancels the computed tax up to that level; for a salaried person the ₹75,000 standard deduction lifts the salary break-even to about ₹12.75 lakh. Just past ₹12 lakh, a marginal-relief provision stops a small increase in income from triggering a disproportionate jump in tax. Second, surcharge applies on higher incomes — added to the slab tax once total income crosses ₹50 lakh, rising in bands, though the new regime caps the highest surcharge rate lower than the old regime did. A 4% health and education cess applies on the tax plus surcharge. The slabs are the same for all individual ages under the new regime — there’s no separate senior-citizen slab as in the old regime. The standard deduction and the employer’s NPS contribution under Section 80CCD(2) are among the few benefits that survive in the new regime. Confirm the slabs, rebate limit and surcharge bands for the year, as these are set by each Finance Act.