Income Tax News 2023 - Tax slab in India

Details and highlights of the 2023-2024 income tax slab: The income tax slab rates for 2023-24 have been significantly revised under the new income tax regime. Under the new income tax regime, the basic exemption limit has been raised to Rs 3 lakh. The income tax rebate limit for salaried and individual taxpayers under the new income tax regime has been increased from Rs 5 lakh to Rs 7 lakh. The income tax slabs for 2023 for the new income tax regime are shown in the table below.

Income Tax News 2023

Income Tax Slabs 2023: These are the new income tax slabs that will be implemented under the new tax regime.

1. There is no or very little tax on income up to Rs 3 lakh.

2. The tax rate is 5% between Rs 3 lakh and Rs 6 lakh.

3. The tax rate is 10% between Rs 6 lakh and Rs 9 lakh.

4. The tax rate is 15% between Rs 9 lakh and Rs 12 lakh.

5. The tax rate is 20% between Rs 12 lakh and Rs 15 lakh.

6. The tax rate is 30% above Rs 15 lakh.

The following are the income tax rates for 2022-23 under the new tax regime.

1. There is no or very little tax on income up to Rs 2.5 lakh.

2. Starting at Rs 2.5 lakh

4. The tax rate is 15% between Rs 7.5 lakh and Rs 10 lakh.

5. The tax rate is 20% between Rs 10 lakh and Rs 12.5 lakh.

6. The tax rate is 25% between Rs 12.5 lakh and Rs 15 lakh.

7. The tax rate is 30% above Rs 15 lakh.

Income Tax Update: Major Announcements Highlights

FM Nirmala Sitharaman has announced a number of new changes aimed at reducing the income tax burden and outlay of the middle class, salaried taxpayers, individual taxpayers, and senior citizens. The following are the highlights of her major tax announcements:

The new income tax regime is now the default, but taxpayers can still choose the old regime.

Only under the old regime is a standard deduction of Rs 50,000 for salaried individuals and a deduction from the family pension of up to Rs 15,000 allowed. It is proposed that these two deductions be allowed under the new regime as well.

The new tax regime will raise the rebate limit from Rs 5 lakhs to Rs 7 lakhs. This means that under the new income tax regime, a taxpayer earning up to Rs 7 lakh will incur no income tax liability.

According to FM, an individual earning 15 lakhs will only have to pay 1.5 lakhs in taxes because 45% of filed returns will be processed within 24 hours.

Average According to FM, the processing time for returns has been reduced from 93 days to 16 days.

Concentrate on technology-based tax governance.

The presumptive taxation turnover limit for professionals has been raised to 75 lacks. Cash receipts should not exceed 5%.

Launch a next-generation IT return form.

A unified filing process system will be established to allow agencies to source data from a common portal based on the preferences of those filing returns.

Under both the old and new regimes, the surcharge on income tax is 10% if the income is above Rs 50 lakh and up to Rs 1 crore, 15% if the income is above Rs 1 crore and up to Rs 2 crore, 25% if the income is above Rs 2 crore and up to Rs 5 crore, and 37% if the income is above Rs 5 crore. It is proposed that under the new regime, the surcharge for individuals, HUF, AOP (other than cooperative), BOI, and AJP will be the same, except that the surcharge rate of 37% will not apply. The highest surcharge will be 25% on income exceeding Rs 2 crore. This would lower the maximum rate. This would reduce the maximum rate from approximately 42.7 per cent to approximately 39 per cent. There is no change in surcharge proposed for those who choose to remain under the old regime.

Encashment of earned leave up to 10 months' average salary at the time of retirement in the case of an employee (other than an employee of the Central Government or a State Government) is exempt to the extent notified under sub-clause (ii) of clause (10AA) of section 10 of the Income-tax Act ("the Act"). At the moment, the maximum amount that can be exempted is Rs 3 lakh. It is proposed that a notification be issued to increase this limit to Rs 25 lakh.

TCS improved on foreign remittances, increasing the rate from 5% to 20% without a limit of 7 lakhs.

Sums received (except in the case of the insured person's death) from an insurance policy (other than ULIP, for which provision already exists as introduced in the Finance Act 2021) where the aggregate of premium payable for any of the years during the terms of the policy exceeds Rs 5 lakhs are now proposed to be taxed. This is being proposed for policies issued on or after April 1st, 2023.

It is now proposed that the cost of acquisition or cost of improvement for the purpose of computing capital gains exclude the amount of interest claimed under section 24 of the Act (under the head income from house property) or deduction under chapter VIA.

It is proposed to amend section 194B and section 194BB (income from lottery or crossword puzzle and horse racing respectively) of the Act to provide that the TDS should be deducted on the amount or “aggregate of the amount” (currently the section only states- amount) exceeding Rs. 10,000 in a financial year. Furthermore, "gambling or betting of any form or nature" is proposed to be included within the scope, and section 194BA is proposed to be introduced for online games.

Currently, if the donee is a non-resident and receives a sum of money in excess of Rs. 50,000 without consideration from a resident individual (except as expressly provided in the Act), the amount is considered income deemed to accrue or arise in India (under section 9). According to the budget, an individual who is not ordinarily resident is also proposed to be included in the ambit.

Capital gains from the transfer/redemption/maturity of market-linked debentures are proposed to be treated and taxed as short-term capital gains under the proposed new section (50AA). It is currently taxed as a long-term capital gain at 10% without indexation.

The time limit for completing scrutiny assessments (from Assessment year 2022-23 onwards) is proposed to be increased from 9 months to 12 months from the end of the relevant AY. This also holds true for updated returns.

How much income tax will you save under the new regime?

1. If you earn up to Rs 7 lakh, you will not have to pay any tax because the rebate limit has been raised to Rs 7 lakh.

2. If you earn Rs 9 lakh, your income tax savings with cess will be Rs 15,600.

3. f you earn Rs 15 lakh, your income tax savings with cess will be Rs 39,000.

New Income Tax Regime 2023-2024: Common Deductions List Not Available

1. Allowance for travel on leave

2. Professional HRA tax

I3. interest in a mortgage (self-occupied)

4. Deductions under Chapter VI-A (80C, 80D, 80E, and so on) except u/s 80CCD(2) (i.e. contribution to NPS by employer)

According to the Budget, "Any individual, HUF, AOP (other than co-operative), BOI or AJP not willing to be taxed under this new regime can opt to be taxed under the old regime. Those with income under the heading "profits and gains of business or profession" who have opted for the old regime can revoke that option only once, after which they will be taxed under the new regime.

Those who do not have income under the heading "profit and gains of business or profession" may exercise the old regime option once a year. " Salaried taxpayers who choose the regular income tax regime must continue to pay income tax in accordance with the tax slabs listed below:

1. Up to Rs 2,50,000 income - NIL tax rate

2. Rs 2,50,001 - Rs 5,00,000 income - 5% tax rate

3. Rs 5,00,001 - Rs 10,00,000 income - 20% tax rate

4. Above Rs 10,00,000 income - 30% tax rate