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Income Tax Rates 2009 - 2010

IndianMoney.com Research Team | Posted On Tuesday, July 07,2009, 01:56 PM

Income Tax Rates 2009 - 2010

 

 

The finance Minister, in his budget speech, announced marginal tax benefits for individual tax payers. He increased the basic exemption limit for male taxpayers and female taxpayers by Rs 10,000 and that of senior citizens by Rs 15,000. There is no change in the Corporate Tax rates, while there has been a modest hike in the exemption limit on personal Income Tax. The exemption limit for Senior Citizens has been increased from Rs. 2.25 lakh to Rs. 2.40 lakh. For Women tax payers the exemption limit has been increased by Rs.10,000 to from Rs.1.80 lakh to Rs. 1.90 lakh and from Rs. 1.50 lakh to Rs.1.60 lakh for all other categories of individual taxpayers. He abolished the surcharge of 10% on income over Rs 10 lakh.

The new tax slabs now stand as follows;

Tax Rate For Individuals

Income Level
Tax Rate
Upto 1,60,000
Nil
1,60,001 to 3,00,000
10%
3,00,001 to 5,00,000
20%
Above 5,00,000
30%
 

Tax Rate For Senior citizens

Income Level
Tax Rate
Upto 240000  
Nil
240000 to 300000  
10%
300001 to 500000 
20%
Above 500000  
30%
In addition to this, an education cess of 3% on the tax amount continues. But a 10% surcharge on income over Rs 10 lakh has been abolished.
 

Saving from revised Tax rates

With the help of below given Table you can understand, what will be your saving from the revision

 For men and women

Taxable income (Rs)
Tax - before budget
Tax -after budget
Difference
Male
Female
Male
Female
Male
Female
2,00,000
5150
2060
4120
1029
1030
1031
5,00,000
56650
53560
55620
52529
1030
1031
10,00,000
211150
208060
210120
207029
1030
1031
12,00,000
300245
296845
271919
268829
28326
28016
15,00,000
402215
398815
364619
361529
37596
37286
20,00,000
572165
568765
519119
516029
53046
52736
25,00,000
742115
738715
673619
670529
68496
68186
40,00,000
1251965
1248565
1137119
1134029
114846
114536
 

For senior citizens

Taxable income (Rs)
Tax before budget
Tax after budget
Difference
2,00,000
Nil
Nil
Nil
5,00,000
49875
47379
2496
10,00,000
203424
201879
1545
12,00,000
291746
263679
28067
15,00,000
393716
356379
37337
20,00,000
563667
510879
52788
25,00,000
733617
665379
68238
40,00,000
1243467
1128879
114588
 
Below given are the changes announced in Budget 2009 - 2010 that will have some impact on your personal taxation.
  • Marginal Increase in Tax Exemption: Personal income tax exemption limit raised for senior citizens by Rs 15,000 and for all others by Rs 10,000.
  • Higher Deduction under Section 80DD: Annual deduction relating to maintenance, including medical treatment, for a dependent with severe disability (more than 80%) has been raised to Rs 1 lakh from the current Rs 75,000.
  • Expanded Scope of Section 80E: Annual deduction in respect of interest on loans taken for higher education purposes has been expanded from the current limited list of courses to cover all fields of studies, including vocational studies, pursued after completion of schooling.
  • Elimination of Surcharge: The 10% surcharge on taxes for those earning annual income above Rs 10 lakhs will no longer exist. This will lead to a tax saving for higher income earners
  • Abolishment of Fringe Benefit Tax (FBT): FBT on the value of fringe benefits provided by employers to employees has been abolished. Reimbursements will be taxed as perquisites at the marginal tax rate. This might increase the tax burden on employees.
  • Increase in Wealth Tax Exemption: The exemption limit for wealth tax has been increased from Rs 15 lakhs to Rs 30 lakhs.
  • Automation of Tax Filing Procedure: Reiteration of the re-engineering of the key business processes around the filing of direct taxes. Expect simplified tax filing in the near future, with the prospect of quicker refunds.

See Also: How To Calculate Income Tax For Salaried Person?

Corporate Tax rates

  • Corporate Tax rates - No Changes in corporate Tax, it continues to stand at 30% plus surcharge of 10% of the corporate tax (for companies with profits above Rs 10 million) along with an education cess that amounts to 3% of corporate tax, totalling to 33.9%.
  • Fringe Benefit Tax (FBT) - Fringe Benefit Tax is abolished
  • Minimum Alternate Tax (MAT) - Increased to 15% of book profit
  • Commodity transaction tax (CTT) – CTT is cancelled
  • Goods and Services Tax (GST) – GST is to be implemented by April 2010, cumulative incidence of GST expected to be around 18%

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