- Sweta
- | Income Tax - Articles
- 09 Apr 2020
- 3,552 Views
- 1 comment
Concessional rate of Tax applicability for individual business owners, Individuals, HUF and professionals as per the new amendment of Finance bill 2020 for Financial year 2020-21
Please read the entire article to get a hold of the optional tax benefit given to Individuals & HUF
New tax structure is as follows:
| Annual Income | New Income Tax Slab Rate |
| Nil to Rs. 2.5 lakh | Exempt |
| Above Rs. 2.5 lakh to Rs. 5 lakh | 5% |
| Above Rs. 5 lakh to Rs. 7.5 lakh | 10% |
| Above Rs. 7.5 lakh to Rs. 10 lakh | 15% |
| Above Rs. 10 lakh to Rs. 12.5 lakh | 20% |
| Above Rs. 12.5 lakh to Rs. 15 lakh | 25% |
| Above Rs. 15 lakh | 30% |
However, to claim the above tax rate benefits there are few deductions which cannot be claimed while you file your ITR
- Chapter VIA Deductions like Insurance, Mediclaim, housing loan, donation, educational loans, etc.
- Sec 24b deduction which is interest repayment on housing loan upto 2 Lakh
- Section 35/ 35AD/ 35CCC,
- Clause (iia) of Section 57. (family pension)
- No set off losses from earlier assessment year.
- No claiming of depreciation u/s 32 of Income tax act
- No exemption or deduction with respect to allowance or perquisites like house rent allowance, Leave travel allowance, deduction for employment allowance, professional tax etc.
Few deductions that are allowed under the new scheme
- Any allowance for the cost of travel or transfer
- Daily allowance given under certain conditions by the employers
- Transport allowance given for handicapped
- Deduction in respect of contribution to pension account
Please note that the new tax regime is optional. You can continue with your old tax regime and claim all the above benefits which is not available if you go for new tax regime. To opt for new tax regime, you have to exercise the option before the due date of furnishing his return of income. Even professionals can claim this benefit.
The new tax rates as mentioned above are really less but it takes away lot of deductions which the individuals and HUF had before. In my opinion, the new tax rates will be beneficial for high income tax earners who fall in the bracket of 30% as these deductions are really marginal for them. However, for income upto 10 lacs, people can go for this concessional rate of tax.
Let me know your opinion.
Author Bio
My Published Posts
More Under Income Tax
One Comment
Leave a Comment
Latest Posts
- Join Live Online Courses on Customs, FTP & Income Tax
- Instructions for filling ITR-4 SUGAM for A.Y. 2020-21
- Instructions for filling ITR-1 SAHAJ for A.Y. 2020-21
- Amendment in Export Policy of Nitrile/NBR Gloves
- Changes in regulatory framework for Housing Finance Companies
- SAT Quashes SEBI’s penalty of Rs. 20 lakhs on DHFL
- Reopening based on mere AIR Information without Application of Mind is Invalid
- Section 68 Addition not Justified for Unexplained Deposit in Bank Account
- Registration For Alternative Investment Fund (AIF)
- How to Calculate TDS on Salary
- IDFC First Bank offering 7% interest on Saving Bank Account- Inherent Risks an investor should consider
Popular Posts
- Join Live Online Courses on Customs, FTP & Income Tax
- Business Loss? – Audit u/s 44AD or 44ADA Applicable or Not?
- Form GSTR-9 (GST annual return)- How to file with FAQs
- How to file GST ITC-01 and FAQs
- Registration of GST Practitioner- All you want to know
- Extend Tax Audit/TP Audit/ITR due date of AY 2020-21
Featured Posts
- Join Live Online Courses on Customs, FTP & Income Tax
- Extend all due dates under GST- Solve Issues in GST
- Extend Income Tax and GST Audit & Return Filing dates
- Request to extend time to file GSTR-3B for September, 2020
- Representation on GST Audit, Notices, ITC, Late Fees issues & Solution
Is car lease option is available under new tax regime or not ? by this option, sufficient tax is saved by giving lease amount to third person in old regime and against that perquisite value of Rs. 21,600/- is added to employee taxable income. Is this option available under new tax regime or not ?