Individual Income Tax Return

Ushma & Associates

Individual Income Tax Return

Income tax is a direct tax which is levied in India on the income and profit of individual. It covers all income like salary, pension, PPF, rental income, the capital gain on sale of immovable property/movable property/shares/mutual funds/securities, interest on FDs/saving/NRO/NRE account, royalty, fee for technical services, profit from business/profession, dividend, etc.

Any income accrued/arises/received in India is taxable in India irrespective of the fact that individual is resident or non-resident. Individuals can opt for the Existing Tax Regime or the New Tax Regime with lower rate of taxation (u/s 115 BAC of the Income Tax Act). In the New Tax Regime though tax rates are lower but benefit of certain Exemptions and Deductions (like 80C, 80D, 80TTB, HRA) are not allowed.

Slab Rate

Existing Tax Regime

Tax slab rates for resident and nonresident are same. It is divided on the basis of age criteria

For Individual 60 years or less of age anytime during the previous year:

Existing Tax Regime

For Individual who are 60 years or more but less than 80 years of age anytime during the previous year:

Existing Tax Regime

For Individual who are 80 years of age or more anytime during the previous year:

Existing Tax Regime

New Tax Regime u/s 115BAC

New tax regime is the same for all categories of Individuals, i.e Individuals & HUF upto 60 years of age, Senior citizens above 60 years upto 80 years , and Super senior citizens above 80 years.

Note:

1. The rates of *Surcharge and **Health & Education cess applicable in both the tax regimes are same.

*Surcharge is an additional charge levied for persons earning Income above the specified limits, it is charged on the amount of income tax calculated as per applicable rates:

Maximum rate of Surcharge on Income by way of Dividend or Income under the provisions of Sections 111A, 112A and 115AD is 15%. There is a concept of marginal relief from surcharge also which make sure that the amount payable as Surcharge shall not exceed the amount of income earned exceeding ₹ 50 lakh, ₹ 1 crore, ₹ 2 crore or ₹ 5 crore respectively. **Health & Education cess is charged at rate of 4% shall also be paid on the amount of income tax plus Surcharge (if any).

2. Rebate u/s 87 is provided to Resident Individual whose Total Income is not more than ₹ 5,00,000. A Rebate of up to 100% of income tax or ₹ 12,500, whichever is less is provided to such individuals. This Rebate is available in both the tax regimes. This rebate is not provided if taxpayer is NRI.

Deductions available to reduce income which further reduce taxes:

Interest paid on housing Loan, Life Insurance Premium, Provident Fund, ELSS, Tuition Fees, National Savings Certificate, Housing Loan Principal, LIC or other insurer towards Pension Scheme, Health Insurance Premium & Preventive Health check up, Medical Expenditure incurred on a Senior Citizen, if no premium is paid on health insurance coverage, Maintenance or Medical treatment of a Disabled Dependent ,interest payments made on loan for higher education, Donations made to prescribed Funds/ Charitable Institutions, rent paid for house in certain conditions, interest received on saving bank accounts/ deposits as prescribed etc.