INCOME TAX SLAB AND TAX RATES UNDER NEW TAX REGIME FOR INDIVIDUALS FROM AY 2021-22 TO AY 2025-26 (FY 2024-25) & TAX AMOUNT BASED ON DIFFERENT INCOME SLAB FOR NON-SALARIED TAX PAYERS & SALARIED TAX PAYERS
If your Tax Liability is more than 10,000 then 100% of Tax needs to be paid in Advance by 15th March 2025 for AY 2025-26 (FY 2024-25)
Delayed payment of advance tax attracts Interest u/s 234B and 234C
INCOME TAX SLAB AND TAX RATES UNDER NEW TAX REGIME FOR INDIVIDUALS FROM AY 2021-22 TO AY 2025-26 (FY 2024-25) & TAX AMOUNT BASED ON DIFFERENT INCOME SLAB FOR NON-SALARIED TAX PAYERS & SALARIED TAX PAYERS
If your Tax Liability is more than 10,000 then 100% of Tax needs to be paid in Advance by 15th March 2025 for AY 2025-26 (FY 2024-25)
Delayed payment of advance tax attracts Interest u/s 234B and 234C
Marginal tax relief calculation FY 2025-26: Budget 2025 has proposed to make normal income up to ₹12 lakh tax-free under the new tax regime for FY 2025-26. This has become possible due to revised tax slabs and an enhanced rebate of ₹60,000 under section 87A.
However, ever since the announcement of revised tax slabs and rates under the new tax regime for FY 2025-26, there has been a lot of confusion about tax on incomes slightly above ₹12 lakh. For example, what happens when a person is earning ₹12.1 lakh or ₹12.5 lakh?
The Central Board of Direct Taxes (CBDT) has cleared the doubts, saying the total income till which marginal relief is available is near about ₹12,75,000.
What is marginal tax relief?
Marginal tax relief is the relief provided by the income tax department when a person’s income is marginally above the tax-free limit. For FY 2025-26, the tax-free income limit is ₹12 lakh. With marginal relief, a taxpayer will not have to pay full tax when his/her income is just a little over ₹12 lakh.
Let’s see how much tax one has to pay with or without marginal relief on incomes of ₹12.1 lakh, ₹12.5 lakh, and ₹12.7 lakh, according to CBDT.
The marginal relief will not apply to income over ₹12.75 lakh.
However, tax on income up to ₹12 lakh is zero because of the proposed rebate of ₹60,000.
For determining the marginal relief, tax liability without marginal relief will be compared with the amount exceeding the total income up to which rebate is available. In this case, that amount is ₹10,000 (₹12,10,000-₹12,00,000).
According to CBDT, the marginal relief in this case will be ₹51,500. This is calculated by deducting income over ₹12 lakh (i.e. ₹10,000) from the total tax liability, i.e. ₹61,500-₹10,000.
Due to the marginal relief of ₹51,500, the total tax payable on income of ₹12.1 lakh will be ₹10,000 only.
