Income-tax slab rates for Individual/HUF for FY 2018-19 (AY 2019-20)

Income tax is a direct taxation mechanism via which individuals pay taxes directly to the government. These taxes are then utilized by the government for various purposes such as building infrastructure, paying for central and state government employees, development, etc. And these direct taxes are usually levied on income or profits.

The Income Tax Act of 1961 governs all the taxation in the country. Of course, it has undergone several amendments to keep up with the times and is revised regularly. India follows a progressive tax model, meaning the tax liability of an individual increases with the increase in their net assessable income. 

Individual contributors and HUFs or Hindu Undivided Families make for the largest contributors towards income tax. If you belong to either of the categories, being aware of the tax slab will help you plan your taxes much better. Instead of feeling anxious at the end moment, you can plan your investments and taxes well in advance and benefit from it. Here are the income-tax slab rates for different categories.

Income Tax Slab for Individuals Below 60 Years (Individuals and HUF)

The tax slab doesn’t include any other surcharges that individuals must pay. Here are some additional charges and taxes that one might end up paying. 

• A Health & Education cess of 4% is levied on the income tax.
• Individuals with income greater than INR 1 crore would attract a 15% surcharge.
• Individuals with income greater than INR 50 lacs but less than INR 1 crore would attract a 10% surcharge.
• Individuals whose annual income is less than INR 5,00,000 can get total tax rebate under Section 87A. This maximum rebate has been increased from INR 2,500 to INR 12,500.

Income Tax Slab for Individuals above 60 years but below 80 years (Senior Citizens)

Here are some additional charges and taxes that one might end up paying. 

• A Health & Education cess of 4% is levied on the income tax.
• Individuals with income greater than INR 1 crore would attract a 15% surcharge.
• Individuals with income greater than INR 50 lacs but less than INR 1 crore would attract a 10% surcharge.

Income Tax Slab for Individuals above 80 years (Super Senior Citizens)

Here are some additional charges and taxes that one might end up paying. 

• A Health & Education cess of 4% is levied on the income tax.
• Individuals with income greater than INR 1 crore would attract a 15% surcharge.
• Individuals with income greater than INR 50 lacs but less than INR 1 crore would attract a 10% surcharge.

Let us consider examples of Sid and Rahul. Assuming both are within 60 years and with Sid earning INR 6,00,000 per annum and Rahul taking home INR 12,00,000 their tax liability would pan out as below. 

The interim budget proposed in 2019 makes way for even fewer taxes. If your net taxable income is INR 5,00,000 or less, you will end up not paying any taxes at all. Tax rebate under Section 87A has been increased from INR 2,500 to INR 12,500.

The tax structures mentioned above holds good for both men and women. 

How is the tax collected?

Now that we are aware of the income taxes, it is only natural to ponder how they are collected. There are three primary methods for collecting income taxes.

• The taxes can either be deducted at source (TDS)
• The taxes can either be collected at source (TCS)
• Taxpayers can voluntarily pay their taxes to their banks

FAQs

1. If I am a salaried individual, which tax slab will be applicable to my income?
   The tax slab for Individuals or HUF holds good for salaried employees. You can refer to the table above to find out your tax liability. One must note that taxes are not different for men and women.
   
   
2. Can I calculate my own tax liability? 
   Yes, you can. You first need to find out which tax slab is applicable and take the examples given above as a reference point for calculating your taxes. 
   
   
3. Which income should I disclose in the tax return for FY 2018-2019?
   Any source of income that you have received between the 1st of April 2018 and 31st of March 2019 should be a part of your tax return for Financial Year 2018-2019 or Assessment Year 2019-2020.
   
   
4. Will my tax liability remain the same for the next year?
   It largely depends on two major factors. If your annual income remains the same for the next financial year and there are no changes to the tax slabs, your tax liability would remain the same for the next year as well. 
   
   
5. What is a standard deduction?
   A standard deduction is a benefit that helps taxpayers reduce their tax liability. The current standard deduction limit is set at INR 50,000.