Income Tax Slab For Fy 2022 23 Ay 2023 24

Income tax slab for FY 2022-24 & AY 2023-24

New tax slabs were announced with the release of the budget for various taxpayers. Companies are taxed at a fixed rate. However, individuals/AOP/HUFs/BOI are taxed at different slab rates. Let’s understand the various tax slabs in the article below.

What is an Income Tax Slab?

In India, Income tax is based on a sliding scale that determines how much an individual will pay for tax in a given year. Taxes are paid by people who earn less.

The government uses tax slabs to determine how much you will pay in taxes. Which tax slab you are in will determine the percentage of tax you pay.

Taxable Income Types in India

The income tax applies to all sources of income. The tax is applicable to all taxpayers, including individuals, corporations, trusts, etc. The following are the various types of income that is taxable in India.

1. Salary or Pension– This category includes allowances, the basic salary, and other income. Pensions received after retirement are also taxed according to the income tax slab.
2. Business Income – Profits from a business can be taxed according to the applicable income tax slab. After all deductions have been made, the income from a business becomes taxable. Corporations will be subject to corporation tax, while individuals who are in business pay according to the income tax slabs.
3. Rental Income– Rental income from the house is taxed according to the income slabs.
4. Income from winning races or lotteries. Income earned from racing, lotteries, etc., is taxed differently. The taxation is not the same as that of income tax slabs.
5. Capital Gains Income– Capital gains from the sale of assets like real estate, gold, mutual funds, stocks, bonds, etc. Taxable. Capital gains are classified as long-term and short-term depending on the asset type and duration of ownership. Capital gains taxes are distinct from income tax slabs.

How can I reduce my taxable income?

1. Use your limit of 1.5 lakhs under Section 80C. 1.5 lakhs. Use that money to pay less taxes.
   1. Fixed Deposits that Save Tax– By investing in Fixed Deposits for five years, you can receive a tax deduction of up to Rs. 1.5 lakhs. These FDs have an interest rate of around 7-8%. However, the interest is taxable.
   2. Public Provident Fund – Public Provident Funds is a 15-year saving plan. Most post offices and banks offer them. PPF interest rates are currently 8%. The interest earned on PPF is not taxable.
   3. ELSS funds – These are mutual funds that invest a minimum of 80% equity. The funds have a 3-year lock-in and are subject to the long-term capital gains taxes.
   4. National Saving Certificate – NSC is valid for five years, and interest rates can reach up to 8%.
   5. Premiums on Life Insurance– The premiums paid for policies such as ULIPs, term policies, and endowment plans are tax deductible. 1.5 lakh.
   6. National Pension Scheme – Contributions to NPS are eligible for deductions under section 80CCD.
   7. Repayment of Home Loan– The principal of the loan can be deducted from your tax up to Rs. 1.5 lakhs.
   8. Payment for tuition fees: The amount of tuition fees paid by children can be deducted from taxes up to Rs. 1.5 lakhs.
   9. Senior Citizens Savings Scheme — Investments in SCSS are eligible for a tax deduction of up to Rs. 1.5 lakhs. The minimum age is 60, and the tenure is five lakhs.
   10. Sukanya Samriddhi Yojana – This scheme is valid for 21 years. This scheme is open to parents with girls under ten years of age. This scheme has an interest rate of 8.5%. The interest is not taxable.
2. Contribute to the National Pension System. – You can invest both in debt and equity pension funds through NPS. The fund can be withdrawn at 60 years old.
3. Health insurance premiums – Investment in health insurance under Section 80D can be deducted from tax. The deduction is Rs. Senior citizens can claim a deduction of Rs. For others, the amount is Rs.
4. Tax deduction for rent paid – You can claim your House Rent Allowance by showing your rent receipt.
5. Interest on Home Loan– Interest on home loans up to Rs. Tax deductions up to Rs.
6. Charities –Money donated to charity qualifies for a deduction. The donation should be made through a charitable institution with an 80G certification.