Income Tax Slab for Salaried Person
By Space Coast Daily // March 16, 2023
Income tax is an essential part of the financial system of a country. It is a tax imposed on the income of individuals and entities.
For salaried individuals, income tax is usually deducted at the source, i.e., from their salaries. In this blog post, we will discuss income tax for salaried individuals and the income tax slab that applies to them.
Income Tax Slab for Salaried Individuals
The income tax slab for salaried individuals is the same as for all other individual taxpayers. The income tax slab is the range of income within which different tax rates are applied. For the financial year 2021-22, the income tax slab rates for individual taxpayers are as follows:
|Income Range||Tax Rate|
|Up to Rs. 2.5 lakh||Nil|
|Rs. 2.5 lakh to Rs. 5 lakh||5%|
|Rs. 5 lakh to Rs. 7.5 lakh||10%|
|Rs. 7.5 lakh to Rs. 10 lakh||15%|
|Rs. 10 lakh to Rs. 12.5 lakh||20%|
|Rs. 12.5 lakh to Rs. 15 lakh||25%|
|Above Rs. 15 lakh||30%|
Salaried individuals have the option of choosing between the old income tax regime and the new income tax regime. In the old income tax regime, they can claim various deductions and exemptions to reduce their tax liability. In the new income tax regime, however, the tax rates are lower, but no deductions and exemptions are allowed.
Tax Deductions for Salaried Individuals
Salaried individuals can claim various tax deductions to reduce their tax liability. Some of the popular tax deductions available to them are as follows:
- Standard Deduction: Salaried individuals can claim a standard deduction of Rs. 50,000 from their taxable income.
- House Rent Allowance (HRA): Salaried individuals who live in rented accommodation can claim HRA as a tax deduction. The amount of HRA that can be claimed depends on the rent paid and the salary of the individual.
- Leave Travel Allowance (LTA): Salaried individuals can claim LTA as a tax deduction for the expenses incurred on travel within India.
- Medical Insurance: Salaried individuals can claim a tax deduction of up to Rs. 25,000 for the medical insurance premium paid for themselves, their spouse, and dependent children.
- Education Loan: Salaried individuals can claim a tax deduction for the interest paid on education loans taken for themselves, their spouse, or children.
Income tax for salaried individuals is an essential part of their financial planning. Understanding the income tax slab that applies to them and the tax deductions they can claim can help them reduce their tax liability.
Salaried individuals have the option of choosing between the old income tax regime and the new income tax regime, depending on their tax-saving goals. They can also use income tax calculators to calculate their tax liability and plan their finances accordingly.
Overall, it is important for salaried individuals to stay updated with the latest income tax rules and regulations to ensure that they comply with the tax laws and avoid any penalties or legal issues.