Income tax slab 2016-17: The knowledge of Income tax slab is essential in order to compute the payment of the income tax. In the Union Budget presented by Finance Minister Arun Jaitley, he said that no changes will be made in the income tax slab rates for the financial year 2016-17.
These tax rates are applicable to Non-residents India, HUF, AOP, BOI.
Income tax slab 2016-17:
Income Tax Slab for Individual Tax Payers (less than 60 years of age) both Men and Women:
| Income Tax Slab | Income Tax Rate | |||||
| Income upto Rs 2,50,000 | Nil | |||||
| Income Rs 2,50,001 to 5,00,000 | 10% of Income exceeding 2,50,000 | |||||
| Income Rs 5,00,001 to 10,00,000 | 20% of Income exceeding 5,00,000 | |||||
| Income above 10,00,000 | 30% of Income exceeding 10,00,000 | |||||
Income Tax Slab for Senior Citizens (60 years of age or above but below 80 years old) both Men and Women:
| Income Tax Slab | Income Tax Rate | |||||
| Income upto Rs 3,00,000 | Nil | |||||
| Income Rs 3,00,001 to 5,00,000 | 10% of Income exceeding 2,50,000 | |||||
| Income Rs 5,00,001 to 10,00,000 | 20% of Income exceeding 5,00,000 | |||||
| Income above Rs 10,00,000 | 30% of Income exceeding 10,00,000 | |||||
Income Tax Slab 2016-17 for Super Senior Citizens (80 years of age or more) both Men and Women:
| Income Tax Slab | Income Tax Rate | |||||
| Income upto Rs 2,50,000 | Nil | |||||
| Income upto Rs 5,00,000 | Nil | |||||
| Income Rs 5,00,001 to 10,00,000 | 20% of Income exceeding 5,00,000 | |||||
| Income above Rs 10,00,000 | 30% of Income exceeding 10,00,000 | |||||
Income Tax Slab 2016-17 for Cooperative societies:
| Income Tax Slab | Income Tax Rate | |||||
| Income upto Rs 10,000 | 10% of total income | |||||
| Income Rs 10,001 to 20,000 | 1,000+10% of Income exceeding 10,000 | |||||
| Income above Rs 20,000 | 3,000+20% of Income exceeding 20,000 | |||||
Income Tax Slab 2016-17 for Business Firms:
The tax rate for the business firms is high. There are no tax slabs as such but the firm has to pay 30% tax on its total income. The surcharge and education cess is also applicable which makes it a total of 30.9% tax on total income.
- For a Local firm, the same tax rate would apply as for a Business firm i.e. 30.9%.
- A domestic company has to pay income tax at the rate of 30%. However, in case its income exceed Rs 1 crore, it will receive some relaxation regarding surcharge which will then be 7%.
- A foreign company will be taxed at 40% rate and the surcharge would be 2% if its income exceeds 1 crore but is less than 10 crore. The surcharge, in case its income exceeds 10 crores will be 5%.
As per the Union Budget 2016-17, there will be a tax benefit of Rs 3,000 that will be enjoyed by the middle class. This benefit will be availed by over 1 crore people. The first time home buyer would also get a tax saving on the home loan interest. Some of the other main highlights of the budget for the financial year 2016-17 are as follows.
Highlights regarding Tax in Union Budget 2016-17:
The income tax slab rates 2016-17 have not been changed in this Union Budget. The other changes are given as below.
The increase in Income Tax rebate: Earlier the Income tax rebate was Rs 2,000. Now this rebate has been increased by Rs 3,000 and it has become Rs 5,000. Those people who have income below Rs 5,00,000 can avail of this rebate.
Increase in Rent Deduction: Tax deduction for the rent payment has been increased from 24,000 to 60,000. Those who live in rented abodes and do not receive a House Rent Allowance can avail of it.
The increase in Deductions on Home Loan Interest: The tax deduction for home loan interest by has been increased by 50,000. Thus, the home buyer would be able to get more tax deductions.
Increase in Surcharge Rate for Individuals: The surcharge is applicable on those earning more than Rs 1 crore per year. In the present budget, the surcharge rate has been increased to 15% from 12%.
