Categories: Tax Planning

Latest Income Tax Slab Rates FY 2018-19 (AY 2019-20)

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.

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:-

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View Comments

Amit says:

April 12, 2019 at 12:23 AM

For LIC Agents also income from Postal Small Savings Agency which ITR to fill up for AY 19-20
- Basavaraj Tonagatti says:
  
  April 12, 2019 at 6:12 AM
  
  Dear Amit,
  Refer my latest post "Income Tax Return Forms AY 2019-20 (FY 2018-19) – Which form to use?".
JASPREET KAUR says:

February 15, 2019 at 12:30 PM

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 says:
  
  February 15, 2019 at 2:22 PM
  
  Dear Jaspreet,
  Who combined both?
  - navtej says:
    
    March 19, 2019 at 9:35 PM
    
    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 says:
      
      March 19, 2019 at 9:54 PM
      
      Dear Navtej,
      Please refer the above post for INCOME TAX SLABS but not on assumption like deductions.
Harsha R says:

January 8, 2019 at 4:35 PM

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 says:
  
  January 8, 2019 at 7:23 PM
  
  Dear Harsha,
  Refer THIS.
Vijay Jain says:

May 11, 2018 at 7:27 PM

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 says:
  
  May 11, 2018 at 7:56 PM
  
  Dear Vijay,
  You are unable to fetch the same in ITR2??
  - Vijay Jain says:
    
    May 11, 2018 at 9:19 PM
    
    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 says:
      
      May 12, 2018 at 8:44 AM
      
      Dear Vijay,
      If you liquidated the fund and gained some STCG from debt funds, then yes you have to show under STCG.
Chandrasekaran says:

May 11, 2018 at 2:43 AM

Dear Sir, I am planning to buy NCDs. Request you to clarify the taxation with an example for NCDs. Thanks.
- Basavaraj Tonagatti says:
  
  May 11, 2018 at 9:56 AM
  
  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 says:

April 14, 2018 at 10:57 AM

What is Standard Deduction. Is all salaried person can deduct it from total income.
- Basavaraj Tonagatti says:
  
  April 14, 2018 at 10:24 PM
  
  Valeed-It is Rs.40,000 per year. Yes, they have to deduct.
rajinderseth says:

April 5, 2018 at 5:26 PM

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 says:
  
  April 5, 2018 at 5:42 PM
  
  Rajinderseth-TDS will be deducted if you not show any proof and your tax liability is more than Rs.2.5 lakh.
rajinderseth says:

April 5, 2018 at 4:45 PM

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 says:
  
  April 5, 2018 at 5:22 PM
  
  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 says:

April 2, 2018 at 7:12 AM

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 says:
  
  April 2, 2018 at 11:46 AM
  
  Yatin-Yes, as per income tax laws annuity is also considered as salary income.
  - Yatin Thaggarse says:
    
    April 2, 2018 at 12:09 PM
    
    Thank you for your prompt response.
    
    Are annuities from LIC Jeevan Suraksha also covered,,?
    - Basavaraj Tonagatti says:
      
      April 2, 2018 at 12:19 PM
      
      Yatin-YES.
      - Yatin Thaggarse says:
        
        April 5, 2018 at 10:25 PM
        
        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 says:
        
        April 6, 2018 at 9:46 AM
        
        Yatin-1) YES.
        2) YES.
Yatin Thaggarse says:

April 1, 2018 at 8:38 PM

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 says:
  
  April 1, 2018 at 9:44 PM
  
  Yatin-I am not sure why you are connecting a group insurance with superannuation scheme. Can you elaborate more?