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KEY PROPOSALS: DIRECT & INDIRECT TAX
DIRECT TAX
INCOME TAX RATES
Individual, HUF, AOP, BOI and AJP
Old regime
| Income (INR) | Existing and Proposed Rates (%) | ||
| Individuals (other than senior and super senior citizens) | Senior Citizens (60 years or more at any time during previous year) | Super Senior Citizens (80 years or more at any time during previous year) | |
| 0 – 250,000 | NIL | NIL | NIL |
| 250,001 – 300,000 | 5 | NIL | NIL |
| 300,001 – 500,000 | 5 | 5 | NIL |
| 500,001 – 1,000,000 | 20 | 20 | 20 |
| 1,000,001 and above | 30 | 30 | 30 |
New Regime as per Section 115BAC of the IT Act (Default Regime w.e.f. AY 2024-25)
No changes have been proposed in the new regime of taxation under Section 115BAC of the IT Act. Accordingly, the rate of tax as applicable for AY 2024-25 and AY 2025-26 is as under:
| Income (INR) | Existing and Proposed Rates (%) |
| Individuals and HUF | |
| Nil to 300,000 | NIL |
| 300,001 - 600,000 | 5 |
| 600,001 - 900,000 | 10 |
| 900,001 - 1,200,000 | 15 |
| 1,200,001 - 1,500,000 | 20 |
| 1,500,000 and above | 30 |
Rebate, Surcharge & Cess for Individual, HUF, AOP, BOI and AJP
| Sr. No. | Particulars | Existing and Proposed rates (%) |
| 1 | Rebate |
Old Regime - INR 12,500 – If total income does not exceed INR 500,000 New Regime - INR 25,000 – If total income does not exceed INR 700,000 |
| 2 | Surcharge (for income other than income covered under Section 111A, 112 & 112A, Section 115AD(1)(b) of the IT Act and Dividend) |
Old Regime:
New Regime:
|
| 3 | Surcharge for income covered under Section 111A, 112, 112A, 115AD(1)(b) of the IT Act, dividend and income of AOPs comprising of companies as its members |
|
| 4 | Cess - Health and Education cess |
|
| 5 |
AMT for Individuals, HUFs, AOPs (Including surcharge and cess) |
Only for old regime:
|
Co-operative Societies
Normal Tax Rates
| Income (INR) | Existing and Proposed Rates (%) |
| 0 – 10,000 | 10 |
| 10,001 - 20,000 | 20 |
| 20,001 and above | 30 |
Special Tax Rates under optional tax regime
| Sr. No. | Particulars | Existing and Proposed rates (%) |
| 1 | Covered under Section 115BAD of the IT Act (Basic rate – 22%) | 25.17% - Irrespective of total income |
| 2 | Covered under Section 115BAE of the IT Act (Basic rate – 15%) - Newly manufacturing co-operative society set up on or after 1st April, 2023 | 17.16% - Irrespective of total income |
| 3 | AMT for co-operative societies |
Only for old regime:
|
Surcharge & Cess for Co-operative Societies
| Sr. No. | Particulars | Existing and Proposed rates (%) |
| 1 | Surcharge on income of co-operative society |
If not opted for special tax rates:
If opted for special tax rates under Section 115BAD or 115BAE:
|
| 2 | Cess - Health and Education cess |
|
Effective tax rates for Companies, Firms (including LLP)
| Sr. No. | Description | Existing and Proposed rates
(%) (Including surcharge & Cess) |
|||
| (A) | Domestic Companies | Net income ≤ INR 10 million | Net Income > INR 10 million, but ≤ INR 100 million | Net income > INR 100 million | |
| 1 | Turnover or gross receipts in previous year 2019-20 ≤ INR 4 billion (Base rate – 25%) | 26.00 | 27.82 | 29.12 | |
| 2 | Covered under Section 115BA of the IT Act (Base rate – 25%) |
26.00 | 27.82 | 29.12 | |
| 3 | Covered under Section 115BAA of the IT Act (Base rate – 22%) |
25.17 | |||
| 4 | Covered under Section 115BAB of the IT Act (Base rate – 15%) | 17.16 | |||
| 5 | Any other Company having turnover or gross
receipts in previous year 2020-21 > INR 4 billion (Base rate – 30%) |
31.20 | 33.38 | 34.94 | |
| 6 | MAT under Section 115JB of the IT Act for companies other than that covered under Section 115BAA and 115BAB of the IT Act (Rate to be applied on book profits – base rate 15%) | 15.60 | 16.69 | 17.47 | |
| 7 | Buy back tax under Section 115QA of the IT
Act (Base rate -20%) |
23.30 | |||
| (B) | Foreign Companies | Net income ≤ INR 10 million | Net Income > INR 10 million, but ≤ INR 100 million | Net income > INR 100 million | |
| 1 | Regular tax (Base rate – 40%) | 41.60 | 42.43 | 43.68 | |
| (C) | Firms and LLP | Net income ≤ INR 10 million | Net income > INR 10 million | ||
| 1 | Regular tax (Base rate – 30%) | 31.2 | 34.94 | ||
| 2 | AMT (Base rate – 18.5%) | 19.24 | 21.55 | ||
Surcharge and Cess
| Particulars | Existing & Proposed |
| Other domestic companies |
|
| Domestic companies covered under Section 115BAA and Section 115BAB of the IT Act |
|
| Foreign companies |
|
| Firms and LLP |
|
| Health and education cess |
|
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