No tax on income upto Rs 5 lakh; after that pay tax at same rate

New Delhi, Feb 1 (UNI) With an eye on the General Elections scheduled to be held in May this year, the Government on Friday raised the income tax threshold limit to Rs 5 lakh.
Presenting Interim Budget 2019-20 in Parliament, Finance Minister Piyush Goyal announced that individuals whose annual income up to Rs 5 lakh will receive full tax rebate under the section 87A.
This means that anyone who has net taxable income up to Rs 5 lakh now would not need to pay any penny for the tax. But individuals who have net taxable income above Rs 5 lakh would have to pay tax under same tax slab as the Government has not announced any changes in the tax slab.
So, if an individual’s net taxable income after availing all the deductions under section 80C to 80U of the Income Tax Act does not exceed Rs 5 lakh, then he or she will not be required to pay any tax. However, if the net taxable income exceeds Rs 5 lakh then taxes will be calculated as per the current tax structure.
And under the present tax regime, resident individuals, who are below 60 years of age, do not need to pay tax if they have income up to Rs 2.5 lakh. After the exemption limit, income tax rates for individuals below 60 years is as follows: No tax on income up to Rs 2.5 lakh, 5 per cent tax on income between Rs 250,001 to Rs 5 lakh; 20 per cent tax on income between Rs 500,001 and Rs 10 lakh; and 30 per cent tax on income above Rs 10 lakh.
Senior citizens aged between 60 years and 80 years with income upto Rs 3 lakh are exempt from income tax. However, if they have income from Rs 300,001 to Rs 5 lakh, it is taxed at 5 per cent, while income from Rs 500,001 to Rs 10 lakh is taxed at 20 per cent and above Rs 10 lakh at 30 per cent.
Super senior citizens who are above 80 years of age and having income upto Rs 5 lakh do not need to pay tax. Income from Rs 500,001 to Rs 10 lakh is taxed at 20 per cent and above Rs 10 lakh is taxed at 30 per cent.

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