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Latest Income Tax Slab and Rates - FY 2023-24 | AY 2024-25

Finance Minister Nirmala Sitharaman announced changes in income tax slab rates under the new tax regime, in Budget 2023. The changes announced on February 1, 2023, will become applicable from April 1, 2023, for FY 2023-24 once the proposals are passed by Parliament.

For the financial year 2023-24, which starts on April 1, 2023, the changes announced in the new tax regime are as follows: The basic exemption limit hiked to Rs 3 lakh from Rs 2.5 lakh under the new income regimeNew tax regime becomes the default option for taxpayers. However, they have the option to opt for the old tax regimeIncome tax slabs have been revised under the new tax regimeStandard deduction of Rs 50,000 was introduced for salaried and pensioners under the new tax regime Rebate under Section 87A increased under the new tax regime for taxable incomes not exceeding Rs 7 lakh. Thus, individuals whose taxable income does not exceed Rs 7 lakh will not have to pay any taxes if they opt for the new tax regime in FY 2023-24. Highest surcharge rate was reduced to 25% from 37% under the new tax regime.
No changes have been made under the old tax regime for FY 2023-24. The income tax slab and rates under the old tax regime remain unchanged for FY 2023-24. Also, no changes have been announced in the deductions and exemptions that are available under the old tax regime. A rebate under Section 87A is available under the old tax regime if taxable income does not exceed Rs 5 lakh.

Till FY 2019-20 (ended on March 31, 2020), there was only one tax regime with four tax slabs and tax rates. An individual can bring down the gross taxable income by claiming deductions under sections such as 80C, 80D, 80TTA, and 80TTB, and tax exemptions on house rent allowance, leave travel concession, etc.

The old tax regime offered multiple basic income exemption limits depending on the age of the taxpayer. For individuals below 60 years of age, the basic income exemption limit is Rs 2.5 lakh. For senior citizens aged 60 years and above but below 80 years, the basic exemption limit is Rs 3 lakh. For super senior citizens aged 80 years and above, the basic exemption limit is Rs 5 lakh.

From FY 2020-21, a new, concessional tax regime has been introduced. This tax regime has been revised from FY 2023-24. The new tax regime has lower tax rates as compared with the old tax regime. If individuals opt for the new tax regime, they have to forgo approximately 70 commonly availed tax deductions and exemptions.

The new tax regime has become the default option from FY 2023-24. However, an individual or Hindu Undivided Family (HUF) has to choose between the old tax regime and the new tax regime every financial year. This is applicable if they do not have any business income.

If an individual taxpayer or HUF has a business income, these taxpayers are allowed to opt for the new income tax regime. However, once opted in, they only have a once-in-a-lifetime opportunity to switch back to the old tax regime. Once they have switched back, they cannot opt for the new income tax regime in future financial years.

Table of Content

Income tax slabs for FY 2023-24 (AY 2024-25) under the new tax regime
Income tax slab rates for FY 2023-24 (AY2024-25), FY 2022-23 (AY 2023-24), FY 2021-22 (AY 2022-23) under old tax regime
How to calculate income tax payable under new tax regime
How to calculate income tax liability under old tax regime
How to know which income tax slab you fall in
Surcharge on income tax
Income tax slabs for FY 2021-22 (AY 2022-23) FY 2022-23 (AY 2023-24) under new tax regime

Income tax slabs for FY 2023-24 (AY 2024-25) under the new tax regime

Budget 2023 has announced changes in the income tax slabs in the new tax regime. The changes in the income tax slabs have been made to make it more attractive for individual taxpayers. The budget has hiked the basic exemption limit to Rs 3 lakh from Rs 2.5 lakh.

Do note that the new income tax slabs in the new tax regime will come into effect from April 1, 2023. Further, the new income tax slabs and changes in rates will apply to incomes earned in FY 2023-24; starting from April 1, 2023.

Here are the income tax slabs under new tax regime.

Income tax slabs under new tax regime for FY 2023-24
Income tax slabs (Rs)	Income tax rate (%)
From 0 to 3,00,000	0
From 3,00,001 to 6,00,000	5
From 6,00,001 to 9,00,000	10
From 9,00,001 to 12,00,000	15
From 12,00,001 to 15,00,000	20
From 15,00,001 and above	30

Changes announced in the new tax regime for FY 2023-24
Given below are the changes that are announced in the new tax regime to make it more attractive:

New income tax regime becomes the default tax regime. Thus, unless an individual specifically opts for the old tax regime, their incomes will be taxed at the new tax regime's slabs and rates
Rebate under Section 87A has been increased to taxable income of Rs 7 lakh (tax rebate of 25,000) from 5 lakh (tax rebate of Rs 12,500). This effectively means that any individual opting for the new tax regime with taxable income of up to Rs 7 lakh will not pay any taxes. Earlier, this tax rebate was available till taxable income of Rs 5 lakh
Basic exemption limit has been hiked to Rs 3 lakh from Rs 2.5 lakh in the new tax regime
The number of income tax slabs under the new tax regime has been reduced to five from six
Standard deduction of Rs 50,000 has been introduced under the new tax regime for salaried and pensioners
Family pensioners can also claim standard deduction of Rs 15,000 under the new tax regime
Highest surcharge rate of 37% has been reduced to 25% under the new tax regime

Income tax slabs under the new tax regime till FY 2022-23 (AY 2023-24)
For FY 2022-23 (ending on March 31, 2023) and prior to that, the income tax slabs under the new tax regime are different from those mentioned above. It is important to note that a person earning any income in FY 2022-23, i.e., between April 1, 2022 and March 31, 2023, and planning to opt for the new tax regime will have to calculate income tax on the basis of the following income tax slabs:

Income tax slabs in new tax regime till FY 2022-23
Income tax slabs (Rs)	Income tax rate (%)
From 0 to 2,50,000	0
From 2,50,001 to 5,00,000	5
From 5,00,001 to 7,50,000	10
From 7,50,001 to 10,00,000	15
From 10,00,001 to 12,50,000	20
From 12,50,001 to 15,00,000	25
From 15,00,001 and above	30

The above income tax slabs are applicable for financial years FY 2020-21 (AY 2021-22), FY 2021-22 (AY 2022-23) and FY 2022-23 (AY 2023-24).

Income tax slab rates for FY 2023-24 (AY2024-25), FY 2022-23 (AY 2023-24), FY 2021-22 (AY 2022-23) under old tax regime

Budget 2023 announced no changes in the old tax regime. Thus, anyone opting for the old tax regime will continue to calculate the income tax payable under the same tax rates in FY 2023-24 (April 1, 2023 - March 31, 2024) as in FY 2022-23 (April 1, 2022-March 31, 2023).

Given below are the income tax rates for FY 2023-24 (AY 2024-25), FY 2022-23 (AY 2023-24) and FY 2021-22 (AY 2022-23) under the old tax regime. The basic exemption limit depends on the age of an individual and status of an individual.

For an individual below 60 years of age, the basic exemption limit is of Rs 2.5 lakh. For senior citizens (aged 60 years and above but below 80 years) the basic income exemption limit is of Rs 3 lakh. For super senior citizens (aged 80 years and above), the basic income exemption limit is Rs 5 lakh. For non-resident individuals, the basic income exemption limit is of Rs 2.5 lakh irrespective of age.

Income tax slabs for individuals under old tax regime
Income tax slabs (Rs)	Income tax rates (%)
From 0 to 2,50,000	0
From 2,50,001 to 5,00,000	5
From 5,00,001 to 10,00,000	20
From 10,00,001 and above	30

Income tax slabs for senior citizens under old tax regime
Income tax slabs (Rs)	Income tax rates (%)
From 0 to 3,00,000	0
From 3,0,001 to 5,00,000	5
From 5,00,001 to 10,00,000	20
From 10,00,001 and above	30

Income tax slabs for super senior citizens under old tax regime
Income tax slabs (Rs)	Income tax rates (%)
From 0 to 5,00,000	0
From 5,00,001 to 10,00,000	20
From 10,00,001 and above	30

How to calculate income tax payable under new tax regime

If you have decided to opt for the new tax regime for the current financial year, i.e., FY 2022-23, then here's how to calculate the income tax payable.

Do note under the new tax regime, an individual is eligible to claim deduction only under section 80CCD (2) of the Income-tax Act, 1961. No other deduction or tax exemption can be claimed under the new tax regime.

Here is an example of how to calculate income tax payable under the new tax regime.

Suppose an individual's gross total income is Rs 20 lakh in FY 2022-23. Further, his/her employer has deposited Rs 1.5 lakh in his/her Tier-I NPS account. This makes him eligible to claim deduction under section 80CCD(2) of the Income-tax Act.

Calculating net taxable income under new tax regime
Particulars	Amount (In Rs)
Gross total income	20,00,000
Deduction under section 80CCD (2)	1,50,000
Net taxable income	18,50,000

Hence, the net taxable income on which income tax payable is to be calculated will be Rs 18.50 lakh (Rs 20 lakh minus Rs 1.5 lakh).

Under the new income tax regime, income up to Rs 2,50,000 is exempted from tax. Hence, no tax will be payable on this income. Post this, the income left which is still chargeable to tax is Rs 16,00,000 (Rs 18,50,000 minus Rs 2,50,000).

The next slab is between Rs 2.5 lakh and up to Rs 5 lakh. Thus, out of Rs 16,00,000, Rs 2.5 lakh (Rs 5 lakh minus Rs 2.5 lakh) will be taxed at 5%. The tax payable here will be Rs 12,500.

Post this, the income left which is still chargeable to tax is Rs 13,50,000 (Rs 16,00,000 minus Rs 2,50,000). The next slab is between Rs 5 lakh and up to Rs 7.5 lakh. Out of Rs 13,50,000, the next Rs 2.5 lakh (Rs 7.5 lakh minus Rs 5 lakh) will be taxed at 10%. The income tax payable comes out to be Rs 25,000.

The balance income left is Rs 11,00,000 (Rs 13,50,000 minus Rs 2,50,000). The next slab under the income tax regime is between Rs 7.5 lakh and up to Rs 10 lakh. Hence, out of Rs 11,00,000, the Rs 2.5 lakh (Rs 10 lakh minus Rs 7.5 lakh) will be taxed at 15%. The tax payable amount will be Rs 37,500.

The balance income left which is still chargeable to tax is Rs 8,50,000 (Rs 11,00,000 minus Rs 2.5 lakh). The next slab is between Rs 10 lakh and up to Rs 12,50,000. Out of Rs 8,50,000, the next Rs 2,50,000 will be taxed at Rs 20%. The tax payable amount will be Rs 50,000.

The balance income left that is still chargeable to Rs tax is Rs 6,00,000 (Rs 8,50,000 minus Rs 2,50,000). The next slab is between Rs 12,50,000 and Rs 15,00,000). Out of Rs 6,00,000, the next Rs 2,50,000 (Rs 15,00,000 minus Rs 12,50,000) will be taxed at 25%. The tax payable amount will be Rs 62,500.

Now the balance income which is left is Rs 3,50,000 (Rs 6,00,000 minus Rs 2,50,000). This will be taxed as per the last slab, i.e., above Rs 15,00,000 at 30% tax rate. The tax payable amount will be Rs 1,05,000.

Calculation of income tax payable for taxable income of Rs 18.50 lakh
Particulars	Income (Rs)	Tax amount (Rs)
Net taxable income	18,50,000	-
Income exempt up to Rs 2,50,000	(2,50,000)	0
Income which is still chargeable to tax (Rs 18,50,000 - 2,50,000)	16,00,000	-
Income tax slab of Rs 2.5 lakh and up to Rs 5 lakh	(2,50,000)	@ 5% =12,500
Income which is still chargeable to tax (Rs 16,00,000 - 2,50,000)	13,50,000	-
Income tax slab of Rs 5 lakh up to Rs 7.5 lakh	(2,50,000)	@ 10% = 25,000
Income which is still chargeable to tax (Rs 13,50,000 -2,50,000)	11,00,000	-
Income tax slab of Rs 7.5 lakh up to Rs 10 lakh	(2,50,000)	@15% = 37,500
Income which is still chargeable to tax (Rs 11,00,000 -2,50,000)	8,50,000	-
Income tax slab of Rs 10 lakh up to Rs 12.50 lakh	(2,50,000)	@ 20% = 50,000
Income which is still chargeable to tax (Rs 8,50,000 -2,50,000)	6,00,000	-
Income tax slab of Rs 12.50 lakh up to Rs 15 lakh	(2,50,000)	@25% = 62,500
Income which is still chargeable to tax (Rs 6,00,000-2,50,000)	3,50,000	-
Income tax slab of above Rs 15 lakh	(3,50,000)	@30% = 1,05,000
Total income tax liability	-	2,92,500
Cess at 4% on total income tax payable (i.e. on Rs 2,92,500)	-	11,700
Final income tax liability (inclusive of cess)	-	3,04,200

The total tax payable amount comes to Rs 2,92,500. One must note that cess and surcharge amount is yet to be added.

Cess is levied at the rate of 4% on the income tax payable. The surcharge is applicable if the income is above Rs 50 lakh.

After adding cess of Rs 11,700, the final tax amount is Rs 3,04,200.

How to calculate income tax liability under old tax regime

If you have decided to opt for the old tax regime for the current financial year, then it is important to know which income tax slab your income falls under. The slab rate applicable to your income will determine the tax rate at which the last rupee of your income will be taxed at.

Under the old income tax regime, an individual taxpayer can claim various deductions and tax exemptions to bring down their gross total income. Once eligible tax exemptions and deductions are deducted from the gross total income, then you will arrive at net taxable income. It is on this income, an individual will calculate tax payable.

Here is an example on how to calculate income tax payable under the old tax regime.

Suppose an individual aged below 60 years has a gross total income of Rs 17 lakh for the current financial year, i.e., FY 2022-23. An individual has decided to opt for the old tax regime for the current financial year. Further, he/she is eligible to claim following tax exemption and deductions - section 80C for up to Rs 1.5 lakh, section 80CCD(1b) for NPS investment of Rs 50,000, section 80D of Rs 25,000 for medical insurance premium paid and section 80TTA of Rs 10,000 on savings account interest earned.

Calculating net taxable income under old tax regime
Particulars	Amount (in Rs)
Gross total income	17,00,000
Section 80C	(1,50,000)
Section 80 CCD(1b) NPS investment	(50,000)
Section 80D – medical insurance premium	(25,000)
Section 80TTA	(10,000)
Net taxable income	14,65,000

After deducting the deductions from the gross total income, one arrives at the net taxable income of Rs 14,65,000. The tax payable will be calculated on the net taxable income.

As per the income tax slab rates table, the first Rs 2.5 lakh from net taxable income will be exempted from tax. This is because there is no tax on income up to Rs 2.5 lakh as per current income tax slabs. Post this, income left on which tax has to be calculated is Rs 12,15,000 (14,65,000-2,50,000). The second slab in the income tax slab table is Rs 2.5 lakh and Rs 5 lakh which is taxed at Rs 5%. This means that out of Rs 12,15,000, then next Rs 2,50,000 will be taxed at 5%. The tax amount will be Rs 12,500.

Now the income left which is still chargeable to tax is Rs 9,65,000. The third slab in the income tax slab table is Rs 5 lakh and Rs 10 lakh, taxed at 20%. This means that out Rs 9,65,000, Rs 5,00,000 will be taxed at 20%. The tax payable here will be Rs 1,00,000.

The balance income on which tax has to be calculated is Rs 4,65,000. The tax amount on this balance income (Rs 14,65,000 minus Rs 10,00,000) will be calculated on the basis of the last slab, i.e., above Rs 10 lakh at the rate of 30%. The tax payable amount comes out to be Rs 1,39,500.

Hence, the total tax payable by an individual will be Rs 2,52,000 (Rs 12,500 + 1,00,000+ 1,39,500).

Calculation of income tax payable for taxable income of Rs 14.65 lakh
Particulars	Income (Rs)	Tax amount (Rs)
Net taxable income	14,65,000	-
Income exempt up to Rs 2,50,000	(2,50,000)	0
Income which is still chargeable to tax (Rs 14,65,000 - 2,50,000)	12,15,000	-
Income tax slab of Rs 2.5 lakh and up to Rs 5 lakh	(2,50,000)	@ 5% =12,500
Income which is still chargeable to tax (Rs 12,15,000 - 2,50,000)	9,65,000	-
Income tax slab of Rs 5 lakh up to Rs 10 lakh	(5,00,000)	@20% = 1,00,000
Income which is still chargeable to tax (Rs 9,65,000 - 5,00,000)	4,65,000	-
Income tax slab of above Rs 10 lakh	(4,65,000)	@ 30% =1,39,500
Total income tax liability	-	2,52,000
Cess at 4% on total income tax payable (i.e. on Rs 2,52,000)	-	10,080
Final income tax liability (inclusive of cess)	-	2,62,080

Do note that cess and surcharge are also levied on the income tax payable. Cess is levied at the rate of 4% and surcharge is levied if the total income exceeds Rs 50 lakh.

From the example above, the cess amount is Rs 10,080. The surcharge will not be applicable as net taxable income does not exceed Rs 50 lakh. The final tax amount payable by individual is Rs 2,62,080.

How to know which income tax slab you fall in

To calculate the income tax payable in a particular financial year, one needs to know the tax slabs their income falls in. Also, it will also depend on the income tax regime chosen by him/her in a particular financial year. An individual will compare the income tax payable in both the tax regimes before choosing the one.

To know the income tax slabs and rates applicable to your income, one must first know the taxable income on which tax has to be calculated. If an individual continues with old, existing income tax regime, then he/she is eligible to claim tax exemption (such as House Rent Allowance exemption, Leave Travel Allowance exemption, standard deduction) and deductions under sections 80C to 80U, as eligible for. After claiming and deducting the tax exemptions and deductions that an individual is eligible for, he/she arrives at the taxable income on which income tax payable is calculated.

For example, your total income from all sources is Rs 12 lakh. You are eligible to claim deduction of Rs 2.10 lakh under sections 80C, 80TTA, 80CCD(1b). The taxable income on which you have to calculate tax will be Rs 9.9 lakh (Rs 12 lakh - Rs 2.10 lakh). Your income tax slab in the old tax regime will be between Rs 5 lakh and Rs 10 lakh. The tax rate is the 20%.

However, if he/she opts for a new, concessional tax regime, then one cannot claim the tax exemption and deductions mentioned above. From the example above, the taxable income will be Rs 12 lakh on which tax payable will be calculated. Under the new tax regime, an individual's income falls under the slab of Rs 10,00,001 and Rs 12,50,000. The tax rate here also is 20%.

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Surcharge on income tax

If an individual's net taxable income exceeds a specified level, then a surcharge is levied. The surcharge is levied on the income tax payable amount before the levy of cess. According to income tax laws, a surcharge is applicable if an individual's taxable income exceeds Rs 50 lakh.

In Budget 2023, the government announced multiple surcharge rates under the new tax regime. The new surcharge rates will be applicable from FY 2023-24 and come into effect from April 1, 2023.

Surcharge rate from April 1, 2023 under new tax regime
Income range	Surcharge rate
Up to Rs 50 lakh	Nil
More than Rs 50 lakh but up to Rs 1 crore	10%
More than Rs 1 crore but up to Rs 2 crore	15%
More than Rs 2 crore	25%

However, individuals opting for the old tax regime in FY 2023-24 will continue to pay the surcharge rate they were paying in the previous financial years.

Surcharge rate under old tax regime
Income range	Surcharge rate
Upto Rs 50 lakh	Nil
More than Rs 50 lakh but up to Rs 1 crore	10%
More than Rs 1 crore but up to Rs 2 crore	15%
More than Rs 2 crore but up to Rs 5 crore	25%
More than Rs 5 crore	37%

There are certain exceptions to the surcharge rates mentioned above. If an individual has earned income from capital gains (short term or long term) through the sale of equity shares and equity mutual funds or dividend income, the surcharge will not exceed 15%, irrespective of the income range.

While understanding the concept of surcharge, one must also know the term marginal relief. The concept of marginal relief kicks in when the amount of surcharge on income tax payable exceeds the increase in income over the specified limit.

Suppose an individual has a net taxable income of Rs 51,00,000. As the income exceeds Rs 50 lakh, the surcharge will be applicable at the rate of 10%. The tax payable on Rs 51,00,000 (without surcharge) is Rs 13,42,500. The surcharge amount will be Rs 1,34,250.

Here the surcharge amount (Rs 1,34,250) is higher than the additional income above Rs 50 lakh (Rs 1,00,000). This is where the concept of marginal relief kicks in.

To know the amount of marginal relief that is applicable, one needs to calculate income tax payable on Rs 50 lakh. This is because no surcharge will be applicable till the income exceeds Rs 50 lakh. The income tax payable will be Rs 13,12,500. Now add income above Rs 50 lakh (Rs 1 lakh) to the income tax payable amount. The tax payable amount under marginal relief will be Rs 14,12,500.

To ascertain the actual income tax payable with surcharge, compare the normal tax liability (before surcharge and cess) and tax liability after marginal tax relief (without cess). Normal tax liability is Rs 13,42,500 and tax liability after marginal tax relief is Rs 14,12,500. The surcharge that will be applicable is Rs 70,000 (Rs 14,12,500 - Rs 13,42,500).

The final tax payable amount will be Rs 13,42, 500 (Tax payable amount) + Rs 70,000 (Surcharge) + Rs 56,500 (Cess at 4% on Rs 14,12,500) = Rs 14,69,000.

Income tax slabs for FY 2021-22 (AY 2022-23) FY 2022-23 (AY 2023-24) under new tax regime

Effective from April 1, 2020 (FY 2020-21), an individual has an option to continue with the old tax regime (claim deductions and tax exemptions) or opt for the new tax regime without any deductions and tax exemptions. The new tax regime, optional in nature, offers lower tax rate as compared to the old tax regime.

Here are latest income tax slabs and rates applicable for FY 2021- 22 (AY 2022-23) and FY 2022-23 (AY 2023-24)

Income tax rates and slabs in new tax regime for FY 2021-22, FY 2022-23
Income tax slabs	Income tax rates
Up to Rs 2,50,000	Nil
Rs 2,50,001 to Rs 5,00,000	5% of (total income minus Rs 2,50,000)
Rs 5,00,001 to Rs 7,50,000	Rs 12,500 + 10% of (total income minus Rs 5,00,000)
Rs 7,50,001 to Rs 10,00,000	Rs 37,500 + 15% of (total income minus Rs 7,50,000)
Rs 10,00,001 to Rs 12,50,000	Rs 75,000 + 20% of (total income minus Rs 10,00,000)
12,50,001 to 15,00,000	Rs 1,25,000 + 25% of (total income minus Rs 12,50,000)
Above 15,00,001	Rs 1,87,500 + 30% of (total income minus Rs 15,00,000)

Income Tax Slabs Trending Terms: New Income Tax Slab ITR Forms Income Tax Slab FY 2023-24 Standard Deduction New Income Tax Regime 87a Rebate Tax Saving Under New Tax Regime Section 80c Deduction Under New Tax Regime

Latest Income Tax Slab and Rates - FY 2023-24 | AY 2024-25

Table of Content

Income tax slabs for FY 2023-24 (AY 2024-25) under the new tax regime

Income tax slab rates for FY 2023-24 (AY2024-25), FY 2022-23 (AY 2023-24), FY 2021-22 (AY 2022-23) under old tax regime

How to calculate income tax payable under new tax regime

How to calculate income tax liability under old tax regime

How to know which income tax slab you fall in

Income tax Calculator

Surcharge on income tax

Income tax slabs for FY 2021-22 (AY 2022-23) FY 2022-23 (AY 2023-24) under new tax regime

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Income tax slab FAQs

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