• twitter-icon
Unlimited Tax Return Filing


Explained: Calculation of Income Tax For Assessment Year 2020-21

Calculation Income Tax AY 2020-21Union budget which was recently unveiled on 1st Feb 2019 took turns for many reasons for both positive and negative aspects of the common public. The announcement of union budget has struck through various benefits for the farmers including yearly INR 6000 pay for the lesser than 2 hectares of the land of any individual farmer. While income tax rebate took the central position of the announcement.

The announcement of union budget 2019, there were multiple benefits showered on the middle class as well as on the farmers alike. The salaried one also got some relief as the government has given full tax rebate up to an income of 5 lakhs.

The effects will take place after the onset of the Assessment Year 2020-21 which will further implement the changes done on an actual level.

Also, note some of the significant changes in the income tax laws:

  • Full tax rebate on income up to INR 5 lakh while in other cases all the aspects i.e. income tax rates/slabs will remain unchanged
  • Standard deduction limit which is applicable to the employees and pensioners hiked from INR 40,000 t0 INR 50,000

Now, Here we will go through some examples understanding the latest amendments in the income tax slab which will further change the liability aspect of a taxpayer.

Tax Calculation According to the Budget 2019
Taxable Annual Income (After Adjusting Deductions) INR 3,50,000 INR 4,00,000 INR 5,00,000 INR 10,00,000
Tax INR 5,000 (@ 5% on 1,00,000) INR 7,500 (@ 5% on 1,50,000) INR 12,500 (@ 5% on 2,50,000) INR 1,12,500 (@5% on 2,50,000, 20% on 5,00,000)
Rebate under Section 87A of I-T Act INR 5,000 INR 7,500 INR 12,500 NA
Tax liability 0 0 0 INR 1,12,500
Cess @ 4% 0 0 0 INR 4,500
Tax payable (after cess) 0 0 0 INR 1,17,000
Tax Calculation According to the Budget 2018
Taxable Income INR 3,50,000 INR 4,00,000 INR 5,00,000 INR 10,00,000
Tax INR 5,000 INR 7,500 INR 12,500 INR 1,12,500
Rebate INR 2,500 NA NA NA
Balance Tax INR 2,500 INR 7,500 INR 12,500 INR 1,12,500
Cess INR 100 INR 300 INR 500 INR 4,500
Tax payable INR 2,600 INR 7,800 INR 13,000 INR 1,17,000

Read Also: Revisit History of IT Slabs (1944-45 to 2018-19) in India Since Independence

Disclaimer:- "All the information given is from credible and authentic resources and has been published after moderation. Any change in detail or information other than fact must be considered a human error. The blog we write is to provide updated information. You can raise any query on matters related to blog content. Also, note that we don’t provide any type of consultancy so we are sorry for being unable to reply to consultancy queries. Also, we do mention that our replies are solely on a practical basis and we advise you to cross verify with professional authorities for a fact check."

Published by Subodh Kumawat
Subodh has done with numerous professional degrees ranging from Human Rights to Banking along with MBA in HR Marketing. He is also interested in the field of tax-related articles and blog as per the industry based norms. Having expert knowledge in diverse sectors, he assures facts and figures along with testimony, in his articles. Working in SAG Infotech, he is a trusted author among the readers globally. View more posts
SAGINFOTECH PRODUCTS

Leave a comment

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

Follow Us on Google News

Google News

Latest Posts

New Offer for Professionals

Super Tax Offer

Upto 20% Off
Tax, ROC/MCA, XBRL, Payroll, Online GST

Limited Offer, Hurry

Big Offer for Tax Experts

Upto 20% Discount on Tax Software

    Select Product*

    Genius Software