What are the Income Tax Brackets in India for FY 2024-25 and should you be paying income tax on your income? Whether you are a salaried employee or businessmen or businesswomen, this article will address many of your queries related to income tax in India.
Income Tax Brackets in India are divided based on age groups and between Old and New Tax Regime. It is important to assess your Income and Investments to select between old or new tax regime while you pay income tax. New regime has reduced slab rates but no deductions are allowed compared to old tax regime, except Standard Deduction for salaried employees.
What are the Income tax brackets in India FOR 2024-25?
In FY 2024-25 (AY 2025-26), the income tax brackets in India is divided based on your age.
- For age up to 60 years, you are treated as non senior citizen of India
- Age 60 years and less than 80 years, you are treated as senior citizen of India
- Age 80 years and above, you are treated as super senior citizen of India
Based on above age groups, we have 2 tax slabs or tax brackets in India:
- Old Tax Regime (Different Slabs based on age groups)
- New Tax Regime (Same Slabs for all age groups)
So Old Tax Regime have different Slab rates based on age groups mentioned above. Old regime also helps you to save income tax using various deduction options for FY 2024-25.
Whereas, New Tax Regime was introduced in Budget 2020, which are reduced Tax Slab rates compared to Old Tax Regime. New Regime does not allow any tax saving options or deductions except Standard Deduction for salaried employees.
You have the option to choose between Old or New Tax Regime while calculating Income Tax.
Let us now see Income Tax Brackets in India for FY 2024-25 based on age groups.
Income Tax Brackets for age up to 60 Years
If your age is below 60 years in FY 2024-25, below are the Tax slab rates for you based on Old Tax Regime:
| Income | Tax Slab Rates (Old Tax Regime) |
|---|---|
| Rs. 0 – Rs. 2.5 Lakh | 0% |
| Rs. 2.5 Lakh – Rs. 5 Lakh | 5% |
| Rs. 5 Lakh – Rs. 10 Lakh | 20% |
| Rs. 10 Lakh or above | 30% |
Let us now see the reduced tax slab rates, that is New Tax Regime for age up to 60 years:
| Income | Tax Slab Rates (New Tax Regime) |
|---|---|
| Rs. 0 – Rs. 3 Lakh | 0% |
| Rs. 3 Lakh – Rs. 6 Lakh | 5% |
| Rs. 6 Lakh – Rs. 9 Lakh | 10% |
| Rs. 9 Lakh – Rs. 12 Lakh | 15% |
| Rs. 12 Lakh – Rs. 15 Lakh | 20% |
| Rs. 15 Lakh or above | 30% |
So New Tax regime has reduced tax slab rates compared to old tax regime. But you will not get many deduction options to save income tax in new tax regime.
We will see How Income Tax is calculated later in this post so continue reading.
Let us now see the Income Tax Brackets for Senior citizens – age 60 years and above but less than 80 years .
Tax Brackets for Senior Citizens
If your age is 60 years and less than 80 years in FY 2024-25, below are the Tax slab rates for you based on Old Tax Regime:
| Income | Tax Slab Rates (Old Tax Regime) |
|---|---|
| Rs. 0 – Rs. 3 Lakh | 0% |
| Rs. 3 Lakh – Rs. 5 Lakh | 5% |
| Rs. 5 Lakh – Rs. 10 Lakh | 20% |
| Rs. 10 Lakh or above | 30% |
As seen above, here the basic exemption limit for senior citizens is Rs. 3 Lakh of income, up to which no income tax need to be paid.
Let us now see the reduced tax slab rates, that is New Tax Regime for Senior Citizens:
| Income | Tax Slab Rates (New Tax Regime) |
|---|---|
| Rs. 0 – Rs. 3 Lakh | 0% |
| Rs. 3 Lakh – Rs. 6 Lakh | 5% |
| Rs. 6 Lakh – Rs. 9 Lakh | 10% |
| Rs. 9 Lakh – Rs. 12 Lakh | 15% |
| Rs. 12 Lakh – Rs. 15 Lakh | 20% |
| Rs. 15 Lakh or above | 30% |
As mentioned above, the tax slab rates in new tax regime is same for all age groups irrespective of whether you are a senior citizen or non senior citizen.
Let us now see Income Tax Brackets for Super Senior Citizens
Income Tax Brackets for Super Senior Citizens
If your age is 80 years or above in FY 2024-25, below are the Tax slab rates for you based on Old Tax Regime:
| Income | Tax Slab Rates (Old Tax Regime) |
|---|---|
| Rs. 0 – Rs. 5 Lakh | 0% |
| Rs. 5 Lakh – Rs. 10 Lakh | 20% |
| Rs. 10 Lakh or above | 30% |
Super senior citizens in India get extra exemption limit of up to Rs. 5 Lakh in a financial year, on which they don’t need to pay any income tax. This may be due to most of the super senior citizens are already retired by this time.
But still, if you are following your passion and generating good revenue out of it, you need to pay tax! So, Above 5 Lakh of income, the slab rates are same on the income as compared to other citizens.
Let us now see the reduced tax slab rates, that is New Tax Regime for Super Senior Citizens:
| Income | Tax Slab Rates (New Tax Regime) |
|---|---|
| Rs. 0 – Rs. 3 Lakh | 0% |
| Rs. 3 Lakh – Rs. 6 Lakh | 5% |
| Rs. 6 Lakh – Rs. 9 Lakh | 10% |
| Rs. 9 Lakh – Rs. 12 Lakh | 15% |
| Rs. 12 Lakh – Rs. 15 Lakh | 20% |
| Rs. 15 Lakh or above | 30% |
So the tax slab rates in new tax regime is same for super senior citizens as well.
So these are the Income Tax Brackets in India for FY 2024-25. If any of your friends is confused about the slab rates in India than share this article with them!
ALSO READ: 7 Important Facts about Income Tax Calculation
What is the tax for 5 lakh salary in India?
As mentioned above in Old and New Tax Regime, 5% tax is applicable on income between Rs. 2.5 Lakh to Rs. 5 Lakh.
So using our income tax calculator for calculating income tax on Rs. 5 Lakh salary in year, below is the tax on Old and New Tax Regime:
Here we have considered that your age is below 60 years, and since you are salaried employee, you get Rs. 50,000 Standard Deduction with Old Tax Regime. This makes you taxable income as Rs. 4.5 Lakh in the year with Old Tax Regime. With new tax regime the taxable income becomes Rs. 4.25 lakh due to standard deduction of Rs. 75,000.
How income tax is Rs. 0 with both regimes even after slab rate of 5% is applicable? This is because of Tax Rebate under Section 87A.
IMPORTANT: According to Tax Rebate under Section 87A, you get Rs. 12,500 maximum tax rebate in FY if your taxable income is below Rs. 5 Lakh. This is applicable for both old and new Tax regime. New Tax regime has tax rebate 87A limit of Rs. 25,000 in financial year.
So below are the income tax calculations with Rs. 5 Lakh salary:
| Items | Old Tax Regime | New Tax Regime |
|---|---|---|
| Salary | Rs. 5 Lakh | Rs. 5 Lakh |
| Standard Deduction | Rs. 50,000 | Rs. 75,000 |
| Taxable Income | Rs. 4.5 Lakh | Rs. 4.25 Lakh |
| 5% Slab rate | Rs. 10,000 | Rs. 6250 |
| Tax Rebate under section 87A (2) | Rs. 10,000 | Rs. 6250 |
| Income Tax (1-2) | Rs. 0 | Rs. 0 |
So above are the Income Tax calculations for 5 Lakh Salary in India.
You can use the Income Tax Excel calculator and know more calculations in below article.
ALSO READ: Income Tax Calculation using Excel
How to save tax on 8 lakhs salary?
There are various deduction options available to save income tax in India. But remember, these deductions are only available when you choose Old Tax Regime. New Tax Regime does not allow any deduction options.
Below are the various deduction options:
All these deductions with limit are explained separately here in Deductions allowed for Tax Payers.
Also you can watch below video to save income tax on your salary.
Save Tax on Salary above 5 Lakh Video
Watch more Videos on YouTube Channel
How can I avoid a higher tax bracket?
In case your income is above 10 Lakh, for which you will belong to 30% tax bracket according to Old tax regime and 15% tax bracket according to new tax regime (based on your income), you can make investments and claim deductions to reduce your taxable income.
Reducing taxable income with old tax regime by using deduction options is the only way to avoid higher tax bracket.
ALSO READ: All Deductions under Section 80 (Chapter VIA)
How is tax calculated on salary?
Income Tax Calculation on Salary is a vast topic to be covered in this article, so I have covered it in other article here on How to calculate income tax on salary using payslip
Steps to follow while calculating income tax:
- Calculate your gross income first, by including Provident Fund and other deductions as part of your gross income
- Divide the deductions under various sections, for example, Provident fund is part of Section 80C, etc.
- This will help you to get Taxable Income, on which tax will be calculated
- On this taxable income, calculate your income tax with old and new tax regime using the income tax calculator
- Check which regime helps you to pay less income tax – Old or New Regime.
- Select the appropriate Tax regime and pay income tax accordingly
- In case you want to change tax regime from new to old regime or vice versa, you can do so while filing ITR (Income Tax Return)
Income Tax Calculation FY 2024-25 Video
ALSO READ: How to File ITR (Income Tax Return) in India
Is 6 lakhs income tax free?
For income of Rs. 6 Lakh, you fall under 20% Tax bracket with Old Tax regime and 10% Tax bracket with New Tax regime.
Considering only Standard Deduction of Rs. 50,000, below are the tax calculations on Rs. 6 Lakh income for FY 2024-25:
| Items | Old Tax Regime | New Tax Regime |
|---|---|---|
| Income | Rs. 6 Lakh | Rs. 6 Lakh |
| Standard Deduction | Rs. 50,000 | Rs. 75,000 |
| Taxable Income | Rs. 5.5 Lakh | Rs. 5.25 Lakh |
| 5% Slab | Rs. 12,500 | Rs. 11,250 |
| 20% Slab in Old and 10% Slab in New Regime | Rs. 10,000 | Rs. 0 |
| Tax Rebate 87A | Rs. 0 | Rs. 11,250 |
| Cess of 4% | Rs. 900 | Rs. 0 |
| Income Tax (1-2) | Rs. 23,400 | Rs. 0 |
As seen above, you pay Rs. 23,400 as income tax with old tax regime and Rs. 0 income tax on new tax regime on Rs. 6 Lakh income and standard deduction applicability.
Note that you can save this income tax by using more deduction options with old tax regime we have already discussed above.
ALSO READ: More Income Tax Calculation Examples
How much income is tax free?
We have already seen the income tax brackets based on various age groups.
- For age below 60 years: Rs. 5 Lakh or below income in financial year is Tax Free, using Tax Rebate under Section 87A
- For Senior Citizens (60-79 years age): Rs. 5 Lakh or below income in financial year is Tax Free, using Tax Rebate under Section 87A
- For Super Senior Citizens (80 years or above): Rs. 5 Lakh or below income in financial year is Tax Free, using Tax Rebate under Section 87A
Above incomes are tax free in both old and new tax regime.
If income is above Rs. 5 Lakh then Basic exemption limits (for old tax regime) are applicable as follows: on which no tax is paid
- Basic Exemption limit for age below 60 years: Rs. 2.5 Lakh
- Basic Exemption limit for Senior citizens: Rs. 3 Lakh
- Basic Exemption limit for Super Senior citizens: Rs. 5 Lakh
Note that Basic exemption limit with new tax regime is Rs. 3 Lakh for all age groups.
Conclusion
So we have seen the Income Tax Brackets in India for all age groups and few examples of income tax calculation as well.
It is always better to assess your income and investment options and choose between Old and New Tax Regime accordingly. The one that helps you pay less income tax should be selected for income tax paying purpose.
Those who do not make any investments and are in high ax bracket can choose to pay income tax using new tax regime, as new regime have reduced tax slab rates.
Some more Reading:
- How to Save Income Tax on Salary above 5 Lakh
- TDS on Salary with Examples
- WATCH: Old vs New Tax Regime Which is Better?
Get EARLY Retirement!
Use Retirement Excel Calculator that will help you to Retire Early.
Click below button to download Retirement Calculator in Excel:
Watch how Retirement Calculator in Excel Works
Income Tax Calculator App – FinCalC
For Income Tax Calculation on your mobile device, you can Download my Android App “FinCalC” which I have developed for you to make your income tax calculation easy.
What you can do with this mobile App?
- Calculate Income Tax for new FY 2024-25 and previous FY 2023-24
- Enter estimated Investments to check income tax with Old and New Tax Regime
- Save income tax details and track regularly
- Know how much to invest more to save income tax
- More calculators including PPF, SIP returns, Savings account interest and lot more
Use Popular Calculators:
- Income Tax Calculator
- Home Loan EMI Calculator
- SIP Calculator
- PPF Calculator
- HRA Calculator
- Step up SIP Calculator
- Savings Account Interest Calculator
- Lump sum Calculator
- FD Calculator
- RD Calculator
- Car Loan EMI Calculator
- Bike Loan EMI Calculator
- Sukanya Samriddhi Calculator
- Provident Fund Calculator
- Senior Citizen Savings Calculator
- NSC Calculator
- Monthly Income Scheme Calculator
- Mahila Samman Savings Calculator
- Systematic Withdrawal Calculator
- CAGR Calculator
I’d love to hear from you if you have any queries about Personal Finance and Money Management.
JOIN Telegram Group and stay updated with latest Personal Finance News and Topics.
Download our Free Android App – FinCalC to Calculate Income Tax and Interest on various small Saving Schemes in India including PPF, NSC, SIP and lot more.
Follow the Blog and Subscribe to YouTube Channel to stay updated about Personal Finance and Money Management topics.
Get EARLY Retirement!
Use Retirement Excel Calculator that will help you to Retire Early.
Click below button to download Retirement Calculator in Excel:
Watch how Retirement Calculator in Excel Works
Income Tax Calculator App – FinCalC
For Income Tax Calculation on your mobile device, you can Download my Android App “FinCalC” which I have developed for you to make your income tax calculation easy.
What you can do with this mobile App?
- Calculate Income Tax for new FY 2024-25 and previous FY 2023-24
- Enter estimated Investments to check income tax with Old and New Tax Regime
- Save income tax details and track regularly
- Know how much to invest more to save income tax
- More calculators including PPF, SIP returns, Savings account interest and lot more
Use Popular Calculators:
- Income Tax Calculator
- Home Loan EMI Calculator
- SIP Calculator
- PPF Calculator
- HRA Calculator
- Step up SIP Calculator
- Savings Account Interest Calculator
- Lump sum Calculator
- FD Calculator
- RD Calculator
- Car Loan EMI Calculator
- Bike Loan EMI Calculator
- Sukanya Samriddhi Calculator
- Provident Fund Calculator
- Senior Citizen Savings Calculator
- NSC Calculator
- Monthly Income Scheme Calculator
- Mahila Samman Savings Calculator
- Systematic Withdrawal Calculator
- CAGR Calculator
I’d love to hear from you if you have any queries about Personal Finance and Money Management.
JOIN Telegram Group and stay updated with latest Personal Finance News and Topics.
Download our Free Android App – FinCalC to Calculate Income Tax and Interest on various small Saving Schemes in India including PPF, NSC, SIP and lot more.
Follow the Blog and Subscribe to YouTube Channel to stay updated about Personal Finance and Money Management topics.
