Income Tax Rates for Financial Year (FY) 2022-23/ Assessment Year (AY) 2023-24: In this section, you will learn about the normal tax rates applicable to different taxpayers.
Normal tax rates for Individuals & HUF
The normal tax rates that apply to a resident individual depend on that person’s age. However, regardless of age, the tax rates will be the same for a non-resident individual. A person can be categorized in the following ways to determine the applicable tax slab:
- Resident individuals below the age of 60 years.
- Resident individual of the age of 60 years or above at any time during the year but below
- the age of 80 years.
- Resident individual of the age of 80 years or above at any time during the year.
- Non-resident individual irrespective of the age.
Individuals
(Other than senior and super senior citizen)
| Net Income Range | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Up to Rs. 2,50,000 | – | – |
| Rs. 2,50,000 to Rs. 5,00,000 | 5% | 5% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% | 20% |
| Above Rs. 10,00,000 | 30% | 30% |
Senior Citizen
(who is 60 years or more at any time during the previous year)
| Net Income Range | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Up to Rs. 3,00,000 | – | – |
| Rs. 3,00,000 to Rs. 5,00,000 | 5% | 5% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% | 20% |
| Above Rs. 10,00,000 | 30% | 30% |
Super Senior Citizen
(who is 80 years or more at any time during the previous year)
| Net Income Range | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Up to Rs. 5,00,000 | – | -% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% | 20% |
| Above Rs. 10,00,000 | 30% | 30% |
Hindu Undivided Family (Including AOP, BOI and Artificial Juridical Person)
| Net Income Range | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Up to Rs. 2,50,000 | – | – |
| Rs. 2,50,000 to Rs. 5,00,000 | 5% | 5% |
| Rs. 5,00,000 to Rs. 10,00,000 | 20% | 20% |
| Above Rs. 10,00,000 | 30% | 30% |
Surcharge: Surcharge is levied on the amount of income-tax at following rates if total income of an assessee exceeds specified limits:-
Rate of Surcharge
Assessment Year 2023-24
| Range of Income | Rates |
|---|---|
| Rs. 50 Lakhs to Rs. 1 Crore | 10% |
| Rs. 1 Crore to Rs. 2 Crores | 15% |
| Rs. 2 crores to Rs.5 Crores | 25% |
| Rs. 5 crores to Rs.10 Crores | 37% |
| Exceeding Rs. 10 Crores | 37% |
Income Tax Rates for Financial Year 2022-23/ AY 2023-24
Note:
1) The enhanced surcharge of 25% & 37%, as the case may be, is not levied, from income chargeable to tax under sections 111A, 112A and 115AD. Hence, the maximum rate of surcharge on tax payable on such incomes shall be 15%
2) From Assessment Year 2023-24 onwards:
The maximum rate of surcharge on tax payable on dividend income or capital gain referred to in Section 112, shall be 15%
The surcharge rate for AOP with all members as a company, shall be capped at 15%
However, marginal relief is available from surcharge in following manner
a) in case where net income exceeds Rs. 50 lakh but doesn’t exceed Rs. 1 Crore, the amount payable as income tax and surcharge shall not exceed the total amount payable as income tax on total income of Rs 50 Lakh by more than the amount of income that exceeds Rs 50 Lakhs.
b) in case where net income exceeds Rs. 1 crore but doesn’t exceed Rs. 2 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 1 crore by more than the amount of income that exceeds Rs. 1 crore
c) in case where net income exceeds Rs. 2 crore but doesn’t exceed Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 2 crore by more than the amount of income that exceeds Rs. 2 crore.
d) in case where net income exceeds Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 5 crore by more thanthe amount of income that exceeds Rs. 5 crore
Health and Education Cess: Health and Education Cess is levied at the rate of 4% on the amount of income-tax plus surcharge
AMT: In the case of a non-corporate taxpayer to whom the provisions of Alternate Minimum Tax (AMT) applies, tax payable cannot be less than 18.5% (+HEC) of “adjusted total income” computed as per section 115JC.
Notes:
W.e.f. Assessment Year 2019-20, In case of a unit located in an IFSC which derives its income solely in convertible foreign exchange, the rate of AMT shall be at the rate of 9% instead of existing rate of 18.50%.
W.e.f. Assessment Year 2023-24, the rate of AMT shall be 15% instead of existing rate of 18.5% in case of a co-operative society.
Note: A resident individual (whose net income does not exceed Rs. 5,00,000) can avail rebate under section 87A. It is deductible from income-tax before calculating education cess. The amount of rebate is 100 per cent of income-tax or Rs. 12,500, whichever is less.
Non-resident individual/HUF
| Net income range | Income-tax rates | Health and Education Ces |
|---|---|---|
| Up to Rs. 2,50,000 | Nil | Nil |
| Rs. 2,50,000 – Rs. 5,00,000 | 5% of (total income minus Rs. 2,50,000) [*] | 4% of income-tax |
| Rs. 5,00,000 – Rs. 10,00,000 | Rs. 12,500 + 20% of (total income minus Rs. 5,00,000) | 4% of income-tax |
| Above Rs. 10,00,000 | Rs. 1,12,500 + 30% of (total income minus Rs. 10,00,000) | 4% of income-tax |
Surcharge: Surcharge is levied on the amount of income-tax at following rates if total income of an assessee exceeds specified limits:
| Range of Income | Rates |
|---|---|
| Rs. 50 Lakhs to Rs. 1 Crore | 10% |
| Rs. 1 Crore to Rs. 2 Crores | 15% |
| Rs. 2 crores to Rs.5 Crores | 25% |
| Rs. 5 crores to Rs.10 Crores | 37% |
| Exceeding Rs. 10 Crores | 37% |
Income Tax Rates for Financial Year 2022-23/ AY 2023-24
However, marginal relief is available from surcharge in following manner:
a) n case where net income exceeds Rs. 50 lakh but doesn’t exceed Rs. 1 Crore, the amount payable as income tax and surcharge shall not exceed the total amount payable as income tax on total income of Rs 50 Lakh by more than the amount of income that exceeds Rs 50 Lakhs.
b) in case where net income exceeds Rs. 1 crore but doesn’t exceed Rs. 2 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 1 crore by more than the amount of income that exceeds Rs. 1 crore
c) in case where net income exceeds Rs. 2 crore but doesn’t exceed Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 2 crore by more than the amount of income that exceeds Rs. 2 crore.
d) in case where net income exceeds Rs. 5 crore, marginal relief shall be available from surcharge in such a manner that the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 5 crore by more than the amount of income that exceeds Rs. 5 crore.
Health and Education Cess: Health and Education Cess is levied at the rate of 4% on the amount of income-tax plus surcharge.
AMT : In the case of a non-corporate taxpayer to whom the provisions of Alternate Minimum Tax (AMT) applies, tax payable cannot be less than 18.5% (+HEC) of “adjusted total income” computed as per section 115JC.
Notes:
- W.e.f. Assessment Year 2019-20, In case of a unit located in an IFSC which derives its income solely in convertible foreign exchange, the rate of AMT shall be at the rate of 9% instead of existing rate of 18.50%.
- W.e.f. Assessment Year 2023-24, the rate of AMT shall be 15% instead of existing rate of 18.5% in case of a co-operative society
Special tax Rate for Individual and HUFs
The Finance Act, 2020, has provided an option to Individuals and HUF for payment oftaxes at the following reduced rates from Assessment Year 2021-22 and onwards:
| Total Income | Rate |
|---|---|
| Up to Rs. 2,50,000 | – |
| From 2,50,001 to 5,00,000 | 5% |
| From 5,00,001 to 7,50,000 | 10% |
| From 7,50,001 to 10,00,000 | 15% |
| From 10,00,001 to 12,50,000 | 20% |
| From 12,50,001 to 15,00,000 | 25% |
| Above 15,00,000 | 30% |
Normal tax rates applicable to a firm
A firm is taxed at a flat rate of 30%. Apart from tax @ 30%, Health and Education Cess is levied @ 4% of income-tax.
Surcharge : Surcharge is levied @ 12% on the amount of income-tax where net income exceeds Rs. 1 crore. In a case where surcharge is levied, health and education cess of 4% will be levied on the amount of income-tax plus surcharge.
However, marginal relief is available from surcharge in such a manner that in the case of a person having a net income of exceeding Rs. 1 crore, the amount payable as income tax and surcharge shall not exceed the total amount payable as income-tax on total income of Rs. 1 crore by more than the amount of income that exceeds Rs. 1 crore.
Income Tax Rates for Financial Year 2022-23/ AY 2023-24
Normal Tax rates applicable to a domestic company
Income-tax rates applicable in case of domestic companies for assessment year 2022-23and 2023-24 are as follows:
| Domestic Company | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Where its total turnover or gross receipt during the previous year 2019-20 does not exceed Rs. 400 crore | NA | 25% |
| Where its total turnover or gross receipt during the previous year 2020-21 does not exceed Rs. 400 crore | 25% | NA |
| Any other domestic company | 30% | 30% |
Surcharge: In addition to tax at above rate, surcharge is levied @ 7% on the amount of incometax if net income exceeds Rs. 1 crore but does not exceed Rs. 10 crore and @ 12% on the amount of income-tax if net income exceeds Rs. 10 crore. In a case where surcharge is levied, health and education cess of 4% will be levied on the amount of income-tax plus surcharge.
Special Tax rates applicable to a domestic company
The special Income-tax rates applicable in case of domestic companies for assessmentyear 2022-23 and 2023-24 are as follows:
| Domestic Company | Assessment Year 2023-24 | Assessment Year 2022-23 |
|---|---|---|
| Where it opted for Section 115BA | 25% | 25% |
| Where it opted for Section 115BA | 22% | 22% |
| Any other domestic company | 30% | 30% |
Surcharge: The rate of surcharge in case of a company opting for taxability under Section 115BAA or Section 115BAB shall be flat 10% irrespective of amount of total income.
Health and Education Cess: The amount of income-tax and the applicable surcharge, shall be further increased by health and education cess calculated at the rate of four percent of such income-tax and surcharge.
Income Tax Rates for Financial Year 2022-23/ AY 2023-24
Normal tax rates applicable to a foreign company
A foreign company is taxed at a flat rate of 40%. Apart from tax @ 40%, Health and Education Cess is levied @ 4% of income-tax.
Surcharge: In addition to tax at above rate, surcharge is levied @ 2% on the amount of incometax if net income exceeds Rs. 1 crore but does not exceed Rs. 10 crore and @ 5% on the amount of income-tax if net income exceeds Rs. 10 crore. In a case where surcharge is levied, health and education cess of 4% will be levied on the amount of income-tax plus surcharge.
Normal tax rates applicable to a Co-operative societies
| Net income range | Rate of income-tax |
|---|---|
| Up to Rs. 10,000 | 10% |
| Rs. 10,000 – Rs. 20,000 | 20% |
| Above Rs. 20,000 | 30% |
Apart from tax at above rate, Health and Education Cess is levied @ 4% of income-tax.
Surcharge: Surcharge is levied @ 12% on the amount of income-tax where net income exceeds Rs. 1 crore . In a case where surcharge is levied, HEC of 4% will be levied on the amount of income-tax plus surcharge.
Note: From Assessment Year 2023-24 onwards, the rate of surcharge in the case of co-operative societies having income between 1 crore to 10 crores is reduced from 12% to 7%.
Special tax rates applicable to a Co-operative societies
The Finance Act, 2020 has inserted a new section 115BAD in Income-tax Act to provide an option to the co-operative societies to get taxed at the rate of 22% plus 10% surcharge and 4% cess. The resident co-operative societies have an option to opt for taxation under newly section 115BAD of the Act w.e.f. Assessment Year 2022-23. The option once exercised u
A local authority is taxed at a flat rate of 30%. Apart from tax @ 30%, Health and Education Cess is levied @ 4% of income-tax
.Surcharge : Surcharge is levied @ 12% on the amount of income-tax where net income exceeds Rs. 1 crore. In a case where surcharge is levied, HEC of 4% will be levied on the amount of income-tax plus surcharge.
