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New Slab of Income Tax in India For F.Y. 2018-19 and A.Y. 2019-20

Tax Structure in India is far different from other developed countries. Income Tax Act, 1961 has defined a slab of Income tax on the basis of which every person is required to pay tax in the country. Tax collected by the Government in the form of Income Tax is Direct Tax which is used by the Govt. for the various public purposes such a defense, improvement of infrastructure, salaries to the Govt Employees etc.

The basic exemption limit under the Income Tax Act, 1961 is Rs 2,50,000 for both Individuals and HUF. No such limit has been defined for Companies, Partnership Firms, AOP and BOI. They have to pay tax on their profits without any limit.

The budget of Finance Act, 2018 has not introduced any change in the slab rate. However, Govt has announced a change in Education and Secondary Education Cess from 3% to 4% which is required to be paid over Income Tax.

Also Read: Who is Required to Fill Income tax Return

Let’s understand the slab rate given under Income Tax Act,1961 for the Financial Year 2018-19 –

Latest Slab of Income Tax For F.Y. 2018-19

Slab of Income Tax for Individuals 

Slab Rate for Individuals (Below 60 Years for Both Men and Women)
Income Range Rate
Below Rs 2,50,000 Nil
Between Rs 2,50,000 – Rs 5,00,000 5%
Between Rs 5,00,000 – 10,00,000 20%
More than Rs 10,00,000 30%
  • Individuals whose GTI is not more than Rs 3 Lakh get a tax benefit of rebate up to Rs 2500 u/s 87A.
  • 10% surcharge is applicable when the Total Income of an Individual exceeds Rs 50 lakhs but limited to Rs 1 Crore.
  • On the income above Rs 1 crore, a surcharge will be applied at the rate of 15% instead of 10%.
  • Education and Secondary Education cess at the rate of 4% is applicable after adding surcharge with the Income Tax.
Slab Rate for Individuals (Above 60 Years i.e. Senior Citizens – Both Men and Women)
Income Range Rate
Below Rs 3,00,000 Nil
Between Rs 3,00,000 – Rs 5,00,000 5%
Between Rs 5,00,000 – 10,00,000 20%
More than Rs 10,00,000 30%
  • Senior Citizens are also liable to pay the surcharge over and above Income Tax at the rate of 10% where the total income exceeds Rs 50 Lakhs but limited to Rs 1 Crore.
  • 15% surcharge is applicable when the income exceeds Rs 1 Crore.
  • Cess is applicable after inclusion of surcharge with the Income Tax.
Slab Rate for Individuals (Above 80 Years i.e. Super Senior Citizen – Both Men and Women)
Income Range Rate
Between Rs 5,00,000 Nil
Between Rs 5,00,000 – 10,00,000 20%
More than Rs 10,00,000 30%
  • Surcharge of 10% is applicable to the income over and above Rs 50 Lakhs upto Rs 1 Crore for the Super Senior Citizens also.
  • The rate of surcharge is 15% for the Individuals whose Total Income is above Rs 1 crore.
  • Education and Secondary education cess at the rate of 4% is applicable over the Income Tax including surcharge.

New Slab of Income Tax for Domestic Companies 

Slab Rate Applicable for Domestic Companies
Income Range Rate
Gross Turnover in the Previous Year is Less than Rs 250 Crore 25%
Gross Turnover in the Previous Year Exceeds Rs 250 Crore 30%
  • The surcharge is applicable on the companies at the rate of 7% when their income is exceeding Rs 1 Crore but limited to Rs 10 Crore.
  • The rate of surcharge is 12% when the total income exceeds Rs 10 Crore.
  • In addition to the above Income Tax, Domestic Companies are also liable to pay 4% Education and Secondary Education Cess on the Income Tax plus surcharge.

Latest Slab of Income Tax Foreign Company –

Income Tax Rate for Foreign Companies
Profit 40%
  • There is no basic exemption limit in case of Foreign Companies, they have to pay Income Tax at the rate of 40% in India irrespective of the amount of profit.
  • 2% surcharge is applicable on the tax where the total income exceeds Rs 1 Crore.
  • 5% surcharge is applicable where the total income exceeds Rs 10 Crore.
  • Cess at the rate of 4% is applicable on the Income Tax plus surcharge.

HUF/AOP/BOI/Any Other Artificial Juridical Person –

Slab Rate for HUF/AOP/BOI/Artificial Juridical Person
Income Range Rate
Upto Rs 2,50,000 Nil
Income Between Rs 2,50,000 – Rs 5,00,000 5%
Income Between Rs 5,00,000 – Rs 10,00,000 20%
Above Rs 10,00,000 Nil
  • 10% surcharge is applicable where the Total Income exceeds Rs 50 Lakhs but limited to Rs 1 Crore.
  • The rate of Surcharge exceeds to 15% where the Total Income Exceeds Rs 1 Crore.
  • Cess is applicable at the rate of 4% on the Income Tax including surcharge.

Slab of Income Tax in India for Partnership Firm

Income Tax Rate of Partnership Firm (including LLP)
Net Income 30%
  • The surcharge is applicable at the rate of 12% where the total income exceeds Rs 1 Crore.
  • Cess at the rate of 4% is applicable on the Income Tax including Surcharge.

Slab Rate for Income Tax Local Authority

Income Tax Rate for Local Authority
Profit Irrespective of any Basic Exemption 30%
  • Surcharge at the rate of 12% is applicable where the total income exceeds Rs 1 Crore.
  • Cess at the rate of 4% is applicable on Income Tax including surcharge.

Slab Rate of a Co-operative Society

Income Tax Slab Rate for Co-operative Society
Income Range Rate
Upto Rs 10,000 10%
Income above Rs 10,000 to Rs 20,000 20%
Income Exceeding Rs 20,000 30%
  • Surcharge at the rate of 12% where the total income exceeds Rs 1 crore.
  • Cess at the rate of 4% is applicable over the Income Tax including surcharge.

Conclusion – In the above article we have discussed the slab rates applicable for Individual, Company, Partnership Firm, HUF, AOP, BOI, Domestic Company, Foreign Company, Local Authority and Cooperative Society. We have also discussed the surcharge and cess applicable to all the above categories.

Hope you found the above article helpful. So, stay in tune with us for more such articles and ask your queries in the comment box given below.

Also Read: Rates of Depreciation under the Income-tax Act. 

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