Income Tax slabs for FY 23-24: An Updated Guide
The 2024 Budget has brought significant changes to the income tax slabs in India. Understanding these updates is crucial for effective financial planning and compliance. This guide provides a detailed overview of the new tax slabs, exemptions, and key considerations.
Revised Income Tax Slabs for Individual Taxpayers
For Individuals Below 60 Years of Age
The updated income tax slabs for individuals under 60 for the FY 23-24 are:
| Old Tax Regime | New Tax Regime u/s 115BAC | ||
| Income Tax Slab | Income Tax Rate | Income Tax Slab | Income Tax Rate |
| Up to ₹ 2,50,000 | Nil | Up to ₹ 3,00,000 | Nil |
| ₹ 2,50,001 – ₹ 5,00,000 | 5% above ₹ 2,50,000 | ₹ 3,00,001 – ₹ 6,00,000 | 5% above ₹ 3,00,000 |
| ₹ 5,00,001 – ₹ 10,00,000 | ₹ 12,500 + 20% above ₹ 5,00,000 | ₹ 6,00,001 – ₹ 9,00,000 | ₹ 15,000 + 10% above ₹ 6,00,000 |
| Above ₹ 10,00,000 | ₹ 1,12,500 + 30% above ₹ 10,00,000 | ₹ 9,00,001 – ₹ 12,00,000 | ₹ 45,000 + 15% above ₹ 9,00,000 |
| ₹ 12,00,001 – ₹ 15,00,000 | ₹ 90,000 + 20% above ₹ 12,00,000 | ||
| Above ₹ 15,00,000 | ₹ 1,50,000 + 30% above ₹ 15,00,000 | ||
For Senior Citizens (60 to 80 Years)
Senior citizens now have a revised exemption limit:
| Old Tax Regime | New Tax Regime u/s 115BAC | ||
| Income Tax Slab | Income Tax Rate | Income Tax Slab | Income Tax Rate |
| Up to ₹ 3,00,000 | Nil | Up to ₹ 3,00,000 | Nil |
| ₹ 3,00,001 – ₹ 5,00,000 | 5% above ₹ 3,00,000 | ₹ 3,00,001 – ₹ 6,00,000 | 5% above ₹ 3,00,000 |
| ₹ 5,00,001 – ₹ 10,00,000 | ₹ 10,000 + 20% above ₹ 5,00,000 | ₹ 6,00,001 – ₹ 9,00,000 | ₹ 15,000 + 10% above ₹ 6,00,000 |
| Above ₹ 10,00,000 | ₹ 1,10,000 + 30% above ₹ 10,00,000 | ₹ 9,00,001 – ₹ 12,00,000 | ₹ 45,000 + 15% above ₹ 9,00,000 |
| ₹ 12,00,001 – ₹ 15,00,000 | ₹ 90,000 + 20% above ₹ 12,00,000 | ||
| Above ₹ 15,00,000 | ₹ 1,50,000 + 30% above ₹ 15,00,000 | ||
For Super Senior Citizens (Above 80 Years)
Super senior citizens enjoy higher exemptions:
| Old Tax Regime | New Tax Regime u/s 115BAC | ||
| Income Tax Slab | Income Tax Rate | Income Tax Slab | Income Tax Rate |
| Up to ₹ 5,00,000 | Nil | Up to ₹ 3,00,000 | Nil |
| ₹ 5,00,001 – ₹ 10,00,000 | 20% above ₹ 5,00,000 | ₹ 3,00,001 – ₹ 6,00,000 | 5% above ₹ 3,00,000 |
| Above ₹ 10,00,000 | ₹ 1,00,000 + 30% above ₹ 10,00,000 | ₹ 6,00,001 – ₹ 9,00,000₹ | ₹ 15,000 + 10% above ₹ 6,00,000 |
| ₹ 9,00,001 – ₹ 12,00,000 | ₹ 45,000 + 15% above ₹ 9,00,000 | ||
| ₹ 12,00,001 – ₹ 15,00,000 | ₹ 90,000 + 20% above ₹ 12,00,000 | ||
| Above ₹ 15,00,000 | ₹ 1,50,000 + 30% above ₹ 15,00,000 | ||
Surcharge and Cess
The surcharge rates remain unchanged:
| Total Income | Old Tax Regime | New Tax Regime |
| Rate of Surcharge Applicable | ||
| Up to Rs. 50 Lakh | Nil | Nil |
| Above Rs. 50 Lakh and up to Rs. 1 Crore | 10% | 10% |
| Above Rs. 1 Crore and up to Rs. 2 Crore | 15% | 15% |
| Above Rs. 2 Crore and up to Rs. 5 Crore | 25% | 25% |
| Above Rs. 5 Crore | 37% | 25% |
Additionally, a 4% Health and Education Cess is levied on the total tax and surcharge.
Tax Rebate Under Section 87A
The rebate under Section 87A has been revised to benefit taxpayers with an annual income up to ₹7 lakh, effectively reducing their tax liability to zero.
Choosing Between New and Old Tax Regimes
Taxpayers can still choose between the old and new tax regimes. The key differences remain:
- Old Regime: Higher tax rates with various exemptions and deductions like HRA, LTA, and Section 80C investments.
- New Regime: Lower tax rates with no exemptions or deductions.
Selecting the appropriate regime depends on your financial goals and eligible deductions.
Updated Deductions and Exemptions
Section 80C
Section 80C continues to allow deductions up to ₹1.5 lakh for investments in specified instruments like PPF, NSC, ELSS, and more.
Section 80D
Deductions for health insurance premiums under Section 80D are maintained:
- For individuals: ₹25,000
- For senior citizens: ₹50,000
Housing Loan Interest
Interest paid on housing loans can still be claimed as a deduction under Section 24(b), up to ₹2 lakh per annum.
Filing Your Income Tax Return
Filing your income tax return (ITR) remains mandatory for individuals earning above the basic exemption limit. The process involves submitting detailed financial information and ensuring all eligible deductions and exemptions are claimed.
Steps to File ITR:
- Collect Documents: Gather necessary documents like Form 16, salary slips, investment proofs, etc.
- Choose the Correct ITR Form: Select the appropriate ITR form based on your income source.
- Fill in Details: Enter personal, income, and tax details accurately.
- Verify and Submit: Verify the details and submit your ITR online or offline.
Conclusion
The updated income tax slabs for FY 23-24 reflect the government’s effort to simplify the tax structure and provide relief to taxpayers. By understanding these changes and evaluating the new and old regimes, you can make informed financial decisions. Stay informed about the latest tax laws and consult a tax professional to optimize your tax planning and compliance.
