What Are the Different Income Tax Slabs for Individuals?

In India, income tax is levied on individuals based on their annual income. The income tax slabs are structured to be progressive, meaning that the more an individual earns, the higher the percentage of tax they must pay. The tax rates vary depending on the income level, age, and residential status of the individual.

Income Tax Slabs for Individuals in India (for the Financial Year 2024-25):

For Individuals Below 60 Years of Age:

• Income up to ₹2,50,000 – No tax
• Income from ₹2,50,001 to ₹5,00,000 – 5% tax
• Income from ₹5,00,001 to ₹10,00,000 – 20% tax
• Income above ₹10,00,000 – 30% tax

Note:

Rebate under Section 87A: Individuals with an income up to ₹5,00,000 can claim a rebate of ₹12,500, effectively reducing their tax liability to zero.

For Senior Citizens (Aged 60 to 80 Years):

• Income up to ₹3,00,000 – No tax
• Income from ₹3,00,001 to ₹5,00,000 – 5% tax
• Income from ₹5,00,001 to ₹10,00,000 – 20% tax
• Income above ₹10,00,000 – 30% tax

Note:

Senior citizens have a higher exemption limit of ₹3,00,000.

For Super Senior Citizens (Aged 80 Years or Above):

• Income up to ₹5,00,000 – No tax
• Income from ₹5,00,001 to ₹10,00,000 – 20% tax
• Income above ₹10,00,000 – 30% tax

Note:

Super senior citizens have the highest exemption limit of ₹5,00,000.

Additional Considerations:

• Health and Education Cess: A 4% health and education cess is added to the tax calculated based on the above slabs.
• Surcharge: A surcharge may be applicable for individuals with income exceeding ₹50 lakh. For example, those with income above ₹1 crore will face a 15% surcharge.

Example:

Individual Below 60 Years of Age:

Income: ₹7,00,000

Tax Calculation:

• First ₹2,50,000: No tax
• Next ₹2,50,000 (₹2,50,001 to ₹5,00,000): Tax at 5% = ₹12,500
• Next ₹2,00,000 (₹5,00,001 to ₹7,00,000): Tax at 20% = ₹40,000
• Total tax = ₹12,500 + ₹40,000 = ₹52,500
• Health and education cess = 4% of ₹52,500 = ₹2,100
• Total tax payable = ₹54,600

Senior Citizen (Aged 65):

Income: ₹6,00,000

Tax Calculation:

• First ₹3,00,000: No tax
• Next ₹3,00,000 (₹3,00,001 to ₹6,00,000): Tax at 5% = ₹15,000
• Total tax = ₹15,000
• Health and education cess = 4% of ₹15,000 = ₹600
• Total tax payable = ₹15,600

Key Exemptions and Deductions:

• Section 80C allows deductions of up to ₹1,50,000 for investments in instruments like PPF, life insurance premiums, and more.
• Section 10(13A) provides exemptions on house rent allowance (HRA).
• Section 80D allows deductions for premiums paid on health insurance.