Without making any changes to the personal income tax slab, the Union Budget 2021- 22 has provided relief to senior citizens in the filing of I-T returns; reduced the time limit for I-T proceedings; announced the setting-up of a Dispute Resolution Committee and faceless Income Tax Appellate Tribunal proceedings; provided relaxations for Non-Resident Indians (NRI); offered an increase in the exemption limit from audit; and accounted for relief for dividend income.
Last year, Ms. Sitharaman introduced a new personal income tax regime, where there is a possibility of paying lesser tax for those who forgo reliefs and exemptions. The new are, however, optional.
Income (per annum)
Proposed Tax Rate
Old Tax Rate
Upto ₹2.5 lakh
₹2.5 lakh-₹5 lakh
₹5 lakh to ₹7.5 lakh
₹7.5 lakh to ₹10 lakh
₹10 lakh to ₹12.5 lakh
₹12.5 lakh to ₹15 lakh
Above ₹15 lakh
Here we take a look at three scenarios of taxable income for salaried individuals.
Illustration 1 – Salaried Individual – Taxable income below ₹10 lakhs
Illustration 2 – Salaried Individual – Taxable income in the range of ₹10 Lakh to ₹15 Lakh
Illustration 3 – Salaried Individual – Taxable income in the range of ₹15 Lakh to ₹50 Lakh
These calculations are based on E&Y calculations. To try out various scenarios, download Google Sheet at bit.ly/taxscenario
Disclaimer – This tax calculator works under certain assumptions to calculate estimated tax liability; and may not provide accurate results in all circumstances. Thus, your actual tax liability may be different. Readers are advised to seek appropriate professional tax advice and compute their tax based on applicable provisions of the Income-tax Act, 1961 and Income-tax Rules, 1962.
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