Income Tax Rate 2023: What will be tax rates for ITR filing AY 2023-24? | The Financial Express

Income Tax Rate 2023: What will be tax rates for ITR filing AY 2023-24?

Income Tax Rates and Slabs 2023 (Assessment Year 2023-24): The Income Tax rates and slabs that were applicable in AY 2022-23 are expected to remain the same in AY 2023-24 under Old Regime.

income tax rate and slab 2023
Here are the Income Tax Rates and Slabs that are expected to remain unchanged in 2023 as well. Representational image

Income Tax Rates 2023 (Assessment Year 2023-24): The Income Tax rates and slabs that were applicable in AY 2022-23 will remain the same for those in the Old Tax Regime. However, changes have been made to the New Tax Regime in Budget 2023. As per Finance Minister Nirmala Sitharaman, individuals earning up to Rs 7 lakh will have to pay no tax under the new regime. Though several experts were expecting that the Budget 2023 would revise the rates for some slabs under Old Regime, no change was proposed by the Finance Minister in here Budget Speech 2023. That being said, the following are the existing Income Tax Rate and Slab that are likely to remain unchanged in 2023 as well. (Check: Income Tax Calculator)

Income Tax Rates AY 2024-25 (New Regime)

(New rates announced in Budget 2023 for AY 2024-25)

0-Rs 3 lakh: Nil;
Rs 3-6 lakh: 5%
Rs 6-9 lakh: 10%
Rs 9-12 lakh: 15%
Rs 12-15 lakh: 20%
Above Rs 15 lakh: 30%

Income Tax Rates AY 2023-24 (New Regime)

0 to Rs 2.5 lakh: NIL
Rs 2.5 lakh to Rs 5 lakh: 5% above Rs 2.5 lakh
Rs 5 lakh to Rs 7.5 lakh: Rs 12,500 + 10% above Rs 5 lakh
Rs 7.50 lakh to Rs 10 lakh: Rs 37,500 + 15% above Rs 7.5 lakh
Rs 10 lakh to Rs 12.5 lakh: Rs 75,000 + 20% above Rs 10 lakh
Rs 12.5 lakh to Rs 15 lakh: Rs 125,000 + 25% above Rs 12.5 lakh
Above Rs 15 lakh: Rs 187,500 + 30% above Rs 15 lakh

Income Tax Rates AY 2023-24 (Old Regime)

Rs 2.5 lakh: NIL
Rs 2.5-5 lakh: 5% above Rs 2.5 lakh
Rs 5-10 lakh: 12,500 + 20% above Rs 5 lakh
Above 10 lakh: Rs 112,500 + 30% above Rs 10 lakh

Also Read: Income Tax relief for salaried employees: Section 80C to HRA rules change expected from Budget 2023

What was the expected Income Tax Rates and Slabs changes in Budget 2023

Several tax experts and industry bodies had urged the Government to revise Income Tax Rate in certain slabs in order to provide relief to taxpayers.

“The tax rate for individuals has not been changed since FY2017-18 (new tax regime bought in FY2020-21). Hence, to give more purchasing power to individuals and some relief to the employed taxpayers, the highest tax rate of 30 per cent should be reduced to 25 per cent and the threshold limit for the highest tax rate be increased from INR 10 lakh to INR 20 lakh. Therefore, the proposed highest slab rate (including surcharge and cess) can be reduced to 35.62 per cent,” says Tapti Ghose, Partner, Deloitte.

In Deloitte’s Budget expectation, Ghose has recommended the following Income Tax rates:

Income Tax Rates (Old Regime)

  • Annual income up to Rs 2.5 lakh: NIL
  • Annual income up to Rs 2.5- 5 lakh: 5%
  • Annual income up to Rs 5-10 lakh: 20%
  • Annual income up to Rs 10-20 lakh: 20%
  • Annual income above Rs 20 lakh: 25%

Income Tax Rates 2023 (New Regime)

  • Annual income up to Rs 2.5 lakh: NIL
  • Annual income up to Rs 2.5- 5 lakh: 5%
  • Annual income up to Rs 5-7.5 lakh: 10%
  • Annual income up to Rs 7.50-10 lakh: 15%
  • Annual income up to Rs 10-12.5 lakh: 20%
  • Annual income up to Rs 12.5-15 lakh: 20%
  • Annual income up to Rs 15-20 lakh: 20%
  • Annual income above Rs 20 lakh: 25%

Budget 2023 was presented by Finance Minister Nirmala Sitharaman on February 1, 2023.

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First published on: 21-12-2022 at 09:39 IST