What are the Latest Income Tax Slab Rates FY 2018-19 (AY 2019-20) after the Budget 2018? Is there any changes to applicable tax rates for individuals? Let us see the details.
I already covered the Budget 2018 related posts and you may refer them for your better understanding.
- Budget 2018 Highlights -10 changes every investor must know
- Budget 2018 LTCG Tax on Stocks and Mutual funds
- Budget 2018 – Mutual Fund Taxation FY 2018-19
In this post, my concentration is to share you about the latest Income Tax Slab Rates for FY 2018-19 (AY 2019-20) and applicable Security Transaction Tax (STT).
The difference between Gross Income and Total Income or Taxable Income?
Before jumping into Latest Income Tax Slab Rates FY 2018-19 (AY 2019-20), first understand the difference between Gross Income and Total Income.
Many of us have the confusion of understanding what is Gross Income and what is Total Income or Taxable Income. Also, we calculate the income tax on Gross Income. This is completely wrong. The income tax will be chargeable on Total Income. Hence, it is very much important to understand the difference.
Gross Total Income means total income under the heads of Salaries, Income from house property, Profits and gains of business or profession, Capital Gains or income from other sources before making any deductions under Sections.80C to 80U.
Total Income or Taxable Income means Gross Total Income reduced by the amount of permissible as deductions under Sec.80C to 80U.
Therefore your Total Income or Taxable Income will always be less than the Gross Total Income.
Latest Income Tax Slab Rates FY 2018-19 (AY 2019-20)
There are three categories of individuals based on the age of taxpayer.
- Individuals whose age below 60 years.
- Senior Citizens whose age is 60 years and above but less than 80 years.
- Super Senior Citizens whose age is 80 years and above.
Hence, based on these three categories of individuals I have separated them and Latest Income Tax Slab Rates for FY 2018-19 (AY 2019-20) are as below.
Note: – Along with the applicable taxes, you have to additional surcharges at below rates.
- Surcharge:
- 10% surcharge on income tax if the total income exceeds Rs.50 Lakhs but below Rs.1 Cr.
- 15% surcharge on income tax if the total income exceeds Rs.1 Cr.
- Health and Education cess : 4% cess on income tax including surcharge. This Health and Education Cess replaced the earlier 2% Education Cess and 1% Secondary and Higher Education Cess from Budget 2018.
How to calculate Income Tax on your net or total income?
Now we understood the Latest Income Tax Slab Rates for FY 2018-19 (AY 2019-20). However, how to calculate the tax on our total income and how much is the tax benefits from Budget 2017 changes?
Let us not take few examples and calculate the income tax amount.
# If you are under 30% Tax Slab and below 60 years of age
Let us say your next taxable income (after all deductions like Sec.80C and all) Rs.15,00,000.
Up to Rs.2,50,000-NIL
Rs.2,50,001 to Rs.5,00,000-Rs.12,500 @5% (Earlier it used to be Rs.25,000).
Rs.5,00,001 to Rs.10,00,000-Rs.1,00,000 @20%
Rs.10,00,001 and above (in this case Rs.15,00,000)=Rs.1,50,000 @30%.
So total tax will be Rs.12,500+Rs.1,00,000+Rs.1,50,000=Rs.2,62,500.
# If you are under 20% Tax Slab and below 60 years of age
Let us say your next taxable income (after all deductions like Sec.80C and all) Rs.7,00,000.
Up to Rs.2,50,000-NIL
Rs.2,50,001 to Rs.5,00,000-Rs.12,500 @5% (Earlier it used to be Rs.25,000).
Rs.5,00,001 to Rs.7,00,000=Rs.40,000 @20%
Therefore, the total tax will be Rs.12,500+Rs.40,000=Rs.52,500.
# If you are under 10% Tax Slab and below 60 years of age
a) Let us say your income is Rs.4,00,000
Up to Rs.2,50,000-NIL
Rs.2,50,001 to Rs.4,00,000-Rs.7,500 @5% (Earlier it used to be Rs.15,000).
b) Let us say your income is Rs.3,00,000
Up to Rs.2,50,000-NIL
Rs.2,50,001 to Rs.3,00,000=Rs.2,500.
However, using Sec.87A of IT Act, your tax liability will be ZERO.
An individual who is resident Indian and whose total income does not exceed Rs. 3,50,000 is entitled to claim rebate under section 87A.
HUF or NRIs are not eligible for this rebate. Also, do remember that this rebate is not available for super senior citizens. Earlier the rebate was Rs.5,000 for those whose income is up to Rs.5,00,000. However, from FY 2017-18 it is now reduced to Rs.2,500 and income range to Rs.3,50,000.
Rs.3,00,000 net income falls under the eligibility of Sec.87A. Therefore, if one claims rebate under this section, then the total income tax payable will be ZERO.
Security Transaction Tax (STT) for FY 2018-19 (AY 2019-20)
Security Transaction Charges or STT is the charges or tax when you buy or sell securities (excluding commodities and currency) through a recognized stock exchange.
The definition of securities involves the below products.
- Shares, scrips, stocks, bonds, debentures, debenture stock or other marketable securities of a like nature in or of any incorporated company or other body corporate;
- Derivatives;
- units or any other instrument issued by any collective investment scheme to the investors in such schemes;
- Security receipt as defined in section 2(zg) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;
- Government securities of equity nature;
- Rights or interest in securities;
- Equity-oriented mutual funds
Therefore, whenever you buy and sell these securities through a recognized stock exchange, then you have to pay this STT.
Now let us understand the latest Security Transaction Tax (STT) applicable for FY 2018-19 (AY 2019-20).
Hope now you became familiar with Latest Income Tax Slab Rates for FY 2018-19 (AY 2019-20) and also the way we can calculate our income tax liability (in simple terms). Any doubts??
Refer our latest posts in regard to Budget 2018:-
- Budget 2018 Highlights -10 changes every investor must know
- Budget 2018 LTCG Tax on Stocks and Mutual funds
- Budget 2018 – Mutual Fund Taxation FY 2018-19
Budget 2018 – Mutual Fund Taxation FY 2018-19
»
Amit
For LIC Agents also income from Postal Small Savings Agency which ITR to fill up for AY 19-20
Basavaraj Tonagatti
Dear Amit,
Refer my latest post “Income Tax Return Forms AY 2019-20 (FY 2018-19) – Which form to use?“.
JASPREET KAUR
CREDIT REBATE OF RS. 2500 AND 40000 STANDARD DEDUCTION ARE BOTH SEPARATE THINGS . WE WILL HAVE TO DEDUCT BOTH FROM THE TAX AMOUNT
Basavaraj Tonagatti
Dear Jaspreet,
Who combined both?
navtej
dear sir ,
it mean sr citizen have no tax upto 3.5 lakh and
normal citizen have no tax upto 3.4 lakh
Basavaraj Tonagatti
Dear Navtej,
Please refer the above post for INCOME TAX SLABS but not on assumption like deductions.
Harsha R
Dear Mr. Basavraj,
I have availed a SBI max gain loan for a flat in september 2016. I got the possession on December 2018. From September 2016 to April 2018 it was Pre-emi(only interest was paid). From April 2018 my Full EMI started.
Now ,I will be claiming HRA from APRIL 2018 to November 2018. And December 2018(possession date) to March 2018 , will be claiming under section 24 B, for 4 months. Can I also claim PRE-EMI/5 this financial year . Can I claim tax exemption interstPaid(4months) + PRE-EMI/5 == 200000 Rs.
Thanks in advance sir
Basavaraj Tonagatti
Dear Harsha,
Refer THIS.
Vijay Jain
Sir,
I have earn some “short term capital gain from debt mutual fund” in fy 2017-18 please let me know where to show this STCG of debt fund in ITR2 (if possible specially intimate “Serial no. of schedule CG part A” where to show this STCG of Debt MF).
Basavaraj Tonagatti
Dear Vijay,
You are unable to fetch the same in ITR2??
Vijay Jain
Sir,
I am able to see the Short term capital gain Schedule “CG part A”, but I am confused at which “Serial no.” of this schedule do I need to show details of STCG from Debt Fund?
Basavaraj Tonagatti
Dear Vijay,
If you liquidated the fund and gained some STCG from debt funds, then yes you have to show under STCG.
Chandrasekaran
Dear Sir, I am planning to buy NCDs. Request you to clarify the taxation with an example for NCDs. Thanks.
Basavaraj Tonagatti
Dear Chandrasekaran,
Interest income will be considered as like FDs (income from other sources). Regarding the selling of the NCDs, if you sell within a year, then it will be considered as STCG and taxed as per your tax slab. However, if you sell after a year, then it is considered as LTCG and the taxation will be at 20% with indexation and 10% without indexation is applicable.
Valeed TP
What is Standard Deduction. Is all salaried person can deduct it from total income.
Basavaraj Tonagatti
Valeed-It is Rs.40,000 per year. Yes, they have to deduct.
rajinderseth
SIR, MY WIFE”S SALARY IS 420000 PY. IN THIS FY AFTER DEDUCTING 40000 AS STD. DEC. AND IF SHE INVEST 150000 IN SEC 80C. REMAINING SALARY COMES TO 230000. WEATHER TDS WILL BE DEDUCTED BY HER EMPLOYER AS HER SALARY IS 35000 PM.
Basavaraj Tonagatti
Rajinderseth-TDS will be deducted if you not show any proof and your tax liability is more than Rs.2.5 lakh.
rajinderseth
SIR, i am getting 300000 pension and salary 200000 . if i am investing 150000 under 80 c. as i can claim 40000 as std dec. What will be my tax amt. my age is below 60.
Basavaraj Tonagatti
Rajinderseth-It is hard for me to calculate for each individual. If you already these invstments then it is easy for you to calculate your taxable income and the tax you have to pay.
Yatin Thaggarse
Sir,
In response to your comment: I perhaps wrongly mentioned group insurance, as most of these old superannuation plans were made by an employer, as an LIC plan.
To simplify, if former employers covered you under a superannuation schemes and you continue to get monthly or annual annuities under it, is this amount deductible per standard deduction for FY 2018-19?
Basavaraj Tonagatti
Yatin-Yes, as per income tax laws annuity is also considered as salary income.
Yatin Thaggarse
Thank you for your prompt response.
Are annuities from LIC Jeevan Suraksha also covered,,?
Basavaraj Tonagatti
Yatin-YES.
Yatin Thaggarse
Dear Sir,
1) DoesVarishta Pension Bima Yojana, Plan No. 828 qualify as an annuity, eligible for Standard Deduction in FY 2018-19?
2) If yes, can a senior citizen club all annuities while filling tax return for the year?
Basavaraj Tonagatti
Yatin-1) YES.
2) YES.
Yatin Thaggarse
Sir,
For FY 2018-19, if you are a senior citizen AND eligible for group.insurance from.former employer’s “Superannuation schemes” can this annuity amount for Standard Deduction?What proof or documentation is required as the case is ten years old.
Basavaraj Tonagatti
Yatin-I am not sure why you are connecting a group insurance with superannuation scheme. Can you elaborate more?
Vijay
Sir, I am a pensioner and also earning some capital gains from shares & mutual funds, so i am eligible for 40000 standard deduction or not?
Basavaraj Tonagatti
Vijay-Sir as per me, YES.
Balkrishna Thite
Dear sir,
If part income derived when age is below 60 and part income received after attaining age of 60 how to calculate the tax.as I am retiring on 31.05.18 on superannuation.
Basavaraj Tonagatti
Balakrishna-Then it is considered as the senior income and taxed accordingly.
Kumar
I am a salaried person.my taxable income is 374568(gross-80c-80d).Can i apply 40000 as standard deduction and calculate 5% income tax on 334568/-.
Is it right or wrong?
Pls suggest.
Basavaraj Tonagatti
Kumar-Please first follow how to arrive at taxable income from gross income. During this period, yes you can claim the standard deduction of Rs.40,000.
Vishnu
Hi
While filing income tax returns for AY 2016-17 . i have made a mistake, the situation is like below
From April 2015 to Jan 2016, i have worked for company A and for the next 2 months i.e till FY end i have worked for company B.
While i have received Form 16 from company A and filed return according to that only. This ITR was processed also.
I have not included the income from Company B while preparing ITR.
When i checked,even though adding up the income from Company B my gross income would be less than 250000. So no tax need to paid either way.
TDS was deducted by Company A.This TDS dedcuted is less than 1000. But unfortunately i forgot to mention this in ITR. So no refund was issued.
I wish to claim this as refund now.
I would like to know whether i can submit a revised return or rectification(But if rectification, where do i get comm ref no) , (by including TDS details and CompanyA+Company B income) .
Can i efile a revised return even after my previous return was processed?
Is there any penalty for delayed filing of revised ITR or incorrect filing of original ITR. ?
Basavaraj Tonagatti
Vishnu-Refer my earlier post “How to file revised income tax return?“.
Vishnu
Hi Basavaraj
I have gone through the mentioned article.In the article you have mentioned the below point.
“4) You can’t file revised return if income tax department already did assessment of your return.”
Yes my previous ITR assessment is complete and i have found this issue after that. So i came to know there is an option called ‘Rectification’ in income tax portal, which can be used to rectify ITR’s which had completed the assessment.
Can you provide more info on this or a separate article regarding rectification. ? Can a refund be claimed through rectification.?
Basavaraj Tonagatti
Vishnu-Sure.
RAVINDRA N L
In response to budget, since rebate on bank instruments (FD, SB , RD etc..) has been raised from 10k to 50k (for senior citizens), should they have to give 15H in the month of April. Bank should not do TDS.
Basavaraj Tonagatti
Ravindra-If your interest income is less than Rs.50,000 for an FY, then you no need to give any Form 15H. If it is more than this, then you have to give Form 15H to avoid TDS.
Investment Portfolio
if someone is earning 3.5 L annum but he is not paying tax then, please tell me the processer to start paying tax
Basavaraj Tonagatti
Investment-Start to pay tax depends on what type of income you have and what deductions you are claiming.
Rashi
Are EPF pensioners eligible for? Alo if you clear the new amendments
Basavaraj Tonagatti
Rashi-It clearly specified that ALL SALARIED and PENSIONERS.
vsv chari
I am a senior citizen.74 years old.
I receive annuity/pension once a year from LIC till death and return of capital to nominee as per Group Insurance scheme.
Also I receive Family Pension @ 725 p.m till death .from LIC.
These policies are bought by the company on my retirement
Can i claim std.deduction benefit ?
Basavaraj Tonagatti
VSV-Yes you can.
Parameswaran TK
Are EPF pensioners eligible for ?.40000 STD deduction. If yes and If the pension is less than 40000/- what is the eligible amount for deduction?
Basavaraj Tonagatti
parameswaran-Yes, all pensioners are eligible for this deduction. If your income (from a pension is less than Rs.40,000), then you can claim such 100% income as a standard deduction and avail the benefits.
Ashish
Dear sir
Kindly clarify new amendment done regarding PPF in budget 2018-19.
Basavaraj Tonagatti
Ashish-Sure and thanks for bringing into my notice.
radha
how much is allowable deduction .other than that above said 150000, can I utilise further nsc interest as deduction.if it possible how much I can utilise.
Basavaraj Tonagatti
Radha-Under Sec.80C the maximum limit is Rs.1,50,000. For other deductions, refer my post “Tax Savings options other than Sec.80C for FY 2017-18“.
radha
thank you very much sir.great assistance.
radha
having lic,children school fees,ulip for almost 150000 for deduction.and nsc invested in Feb 2017.
Basavaraj Tonagatti
Radha-Then use those deductions and arrive at final total income.
radha
if one earns interest through nsc kvp nearly 725000per year.no other source of income.what will be the tax.and how much deduction allowed.
Basavaraj Tonagatti
Radha-Such interest income be considered as the “Income from Other Sources” and the same above rules applies for calculation based on the age.
radha
thanks for ur instant. reply.my age comes under below 60.is there any deduction specially allowed.because this is nsc.and I reinvesting. what will be the tax approximately.
Basavaraj Tonagatti
Radha-If you don’t have any other income sources, then the interest income will be taxable as per the above tax slab (hard to say which deductions apply with your limited sharing).
Ddg
For fy 2018-19
You have not shown standard deduction of rs 40000 as announced in budget
Basavaraj Tonagatti
Ddg-That will not come under IT Slabs. Also, Rs.40,000 deduction is only applicable to salaried and pensioners not for all.
MAHENDER BAINS
please let me know about Section 87 A and transport allowance for fy 2018 -2019
Basavaraj Tonagatti
Mahender-Including Transport and Medical allowance you can now claim the maximum of Rs.40,000. You no need to submit any proof.
Anand Sharma
You haven’t factored this deduction in your tax calculations. Also, any specific reason you have two slabs for 5% instead of just combining them into one?
Basavaraj Tonagatti
Anand-Rs.40,000 standard deduction is applicable ONLY to salaried and pensioners but not for all. Hence, I excluded that. Regarding two 5% slabs, there is no such two 5% slabs, but while creating table, to show for all individuals (senior and super seniors), for simplicity I made in that way. First, you identify in which tax slab you will come under. Then refer above table.