Budget 2019: Income Tax Slabs for FY 2019-20 (AY 2020-21)

Your income from salary, business or other income like income from fixed/recurring deposits etc are taxed as per income tax slabs. Budget 2019 has made NO changes in the tax slab. The announcement that individuals with income up to Rs 5 Lakh would get full rebate is through Section 87A.  

  • Rebate under Section 87A changed from Rs 2,500 to Rs 12,500 or 100% of income tax (whichever is lower) for individuals with income below Rs 5 Lakhs (from Rs 3.5 Lakhs)
  • Standard Deduction raised for Salaried & Pensioners from Rs 40,000 to Rs 50,000
  • In case of 2 house, tax on notional rent not applicable on second house and can be shown as self-occupied
  • TDS threshold for bank/post office/co-operative society deposits – raised to Rs. 40,000 per year from 10,000 per year.
  • Sec 54 exemption allowed on long term capital gains selling of one residential property to buy 2 residential property once in lifetime.

The government has not changed the tax slab but given the benefit through Sec 87A as it solves two things:

  1. It provides No benefit to people with taxable income of more than Rs 5 Lakh
  2. Individuals with income of more than Rs 2.5 lakh still need to file their income tax returns, keeping the return filer high

Learn about Section 87A of income Tax

Income Tax Slabs:

There is NO separate tax slab for men and women. Earlier women used to have slight benefit over men in terms of lower taxes!

The tax slabs are determined on age of person. As of today there are 3 slab rates based on age:

  1. Below 60 years of age
  2. Senior Citizens (60 to less than 80 years of age)
  3. Very Senior Citizens (80+ years of age)

How much taxes you pay next year? Download FY 2018-19 Income Tax Calculator 

The table below gives the tax slab rates:

Income Tax Slab for HUFs & Individuals (below 60 years – for both Men & Women)

Income SlabTax Rate
Income up to Rs 2,50,000No Tax
Income from Rs 2,50,000 – 5,00,0005%
Income from Rs 5,00,000 – 10,00,00020%
Income more than Rs 10,00,00030%
  • Surcharge:
    • 10% surcharge on income tax if the total income exceeds Rs 50 Lakhs but below Rs 1 crore
    • 15% surcharge on income tax if the total income exceeds Rs 1 crore
  • Health and Education Cess: 4% cess on income tax including surcharge
  • Rebate under Section 87A: Rs 12,500 or 100% of income tax (whichever is lower) for individuals with income below Rs 5 Lakhs

Download: Free ebook for Income Tax Planning for FY 2018-19

Income tax slab for senior citizens (60 years to less than 80 years old) (both men & women)

Income SlabTax Rate
Income up to Rs 3,00,000 No Tax
Income from Rs 3,00,000 – 5,00,0005%
Income from Rs 5,00,000 – 10,00,00020%
Income more than Rs 10,00,00030%
  • Surcharge:
    • 10% surcharge on income tax if the total income exceeds Rs 50 Lakhs but below Rs 1 crore
    • 15% surcharge on income tax if the total income exceeds Rs 1 crore
  • Health and Education Cess: 4% cess on income tax including surcharge
  • Rebate under Section 87A: Rs 12,500 or 100% of income tax (whichever is lower) for individuals with income below Rs 5 Lakhs

Income tax slab for Very senior citizens (80 years or more) (both men & women)

Income SlabTax Rate
Income up to Rs 5,00,000 No Tax
Income from Rs 5,00,000 – 10,00,00020%
Income more than Rs 10,00,00030%
  • Surcharge:
    • 10% surcharge on income tax if the total income exceeds Rs 50 Lakhs but below Rs 1 crore
    • 15% surcharge on income tax if the total income exceeds Rs 1 crore
  • Health and Education Cess: 4% cess on income tax including surcharge
Income Tax Slabs for FY 2019-20 in Budget 2019
Income Tax Slabs for FY 2019-20 in Budget 2019

Income tax slab for Domestic Companies:

Company TurnoverTax Rate
Less than 250 crore25%
More than 250 crore30%
  • Surcharge:
    • 7% surcharge if the income is more than 1 crore but less than 10 crore
    • 12% surcharge if the income is more than 10 crore
  • Health and Education Cess: 4% cess on income tax including surcharge

Also Read: 25 Tax Free Incomes & Investments in India

Income tax slab for Partnership Firm:

A partnership firm (including LLP) income is taxable at 30%.

  • Surcharge: 12% surcharge on income tax if the total income exceeds Rs 1 crore
  • Health and Education Cess: 4% cess on income tax including surcharge

Capital Gains Tax Rates:

Some income related to capital gains are taxed at special rates as shown below:

Capital GainsTax Rate
Short term capital gains from assets (Other than shares & mutual funds)At Income Tax Slab rates listed above
Long term capital gains from assets (Other than shares & mutual funds)20% (+4% Health and Education Cess)
Short term capital gains on shares and equity mutual funds15% (+4% Health and Education Cess)
Long term capital gains on shares and equity mutual funds10% (+4% Health and Education Cess)
Short term capital gains on debt mutual fundsAt Income Tax Slab rates listed above
Long term capital gains on debt mutual fundsAt 20% (+4% Health and Education Cess) with indexation

The above rates are based on FM speech. We will update after the budget documents are out and we look at the fine print.

7 thoughts on “Budget 2019: Income Tax Slabs for FY 2019-20 (AY 2020-21)

  1. Sandeep Doshi says:

    Nice post!

  2. MOOLCHAND SONI says:

    What is the limit for bank to deduct TDS on Interest income for FY 2019 20 senior citizens is interest income is 5.75 lakh will bank deduct TDS from Rs 1against from 15 H

  3. PLZZ MAIL THESE CHARTS AT [email protected]

  4. Income tax slabs unchanged! Full tax rebate for taxpayers with taxable income up to Rs 5 lakh through Section 87A.

  5. Just read a news article in NDTV ( https://www.ndtv.com/business/budget-2019-calculate-income-tax-for-2020-21-with-examples-income-tax-changes-announced-on-feb-1-1987667) as per this article if an individual have taxable income of more that 5Lacs after all the deductions like , Standard, 80C, Home loan Interest, HRA. Then he is not entitled for the any benefit. How far is it true.

  6. chander parkash says:

    PLZZ MAIL THESE CHARTS AT [email protected]

Leave a Reply

Your email address will not be published. Required fields are marked *