The Income Tax Slab for the Financial Year 2022-23 (FY 2022-23) and Assessment Year 2023-24 (AY 2023-24) have been announced by the Government of India. It applies to all taxpayers across India and is applicable from April 1, 2022, to March 31, 2023.
It is important to note that the income tax slab for FY 2022-23 and AY 2023-24 are the same. The tax slab for FY 2022-23 and AY 2023-24 applies to all individuals and Hindu Undivided Families (HUF).
Income Tax Slab for FY 2022-23 and AY 2023-24 is divided into three slabs. The first slab is for income up to ₹2.5 lakhs, which is exempt from tax. The next slab is for income between ₹2.5 lakhs to ₹5 lakhs, which is taxed at 5%. The last slab is for income over ₹5 lakhs, which is taxed at 20%. In addition to the tax slabs, there are cess and surcharge applicable on the income.
The tax slab for FY 2022-23 and AY 2023-24 has been revised from the previous year. The tax exemption limit has been increased from ₹2.5 lakhs to ₹5 lakhs. This will benefit taxpayers who have an income of up to ₹5 lakhs. The higher tax slab of 20% has also been revised to apply to income over ₹10 lakhs. This will reduce the burden on taxpayers with higher incomes.
Budget 2023 New Income Tax Regime
| Income range | Income tax rate |
| Up to ₹ 3,00,000 | Nil |
| ₹ 300,000 to ₹ 6,00,000 | 5% on income which exceeds ₹3,00,000 |
| ₹ 6,00,000 to ₹ 900,000 | ₹15,000 + 10% on income more than ₹6,00,000 |
| ₹ 9,00,000 to ₹ 12,00,000 | ₹45,000 + 15% on income more than ₹9,00,000 |
| ₹ 12,00,000 to ₹ 1500,000 | ₹90,000 + 20% on income more than ₹12,00,000 |
| Above ₹ 15,00,000 | ₹150,000 + 30% on income more than ₹15,00,000 |
In India, income tax is imposed on the income earned by individuals, Hindu Undivided Families (HUFs), partnership firms, Limited Liability Partnerships (LLPs), and corporations, as per the Income Tax Act. For individuals, if their income exceeds the basic exemption limit, tax is calculated using the slab system.
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Understanding the Changes to the Income Tax Slab for AY 2023-24
The income tax slab for FY 2022-23 and AY 2023-24 has undergone some significant changes from the previous year. The changes have been made to provide relief to taxpayers with low income. The most notable change is the increase in the tax exemption limit from ₹2.5 lakhs to ₹5 lakhs. This will benefit taxpayers who have an income of up to ₹5 lakhs.
The higher tax slab of 20% has also been revised to apply to income over ₹10 lakhs. This will reduce the burden on taxpayers with higher incomes. In addition, the surcharge applicable on income above ₹1 crore has also been reduced from 15% to 12%. The cess applicable on income tax has also been increased from 4% to 5%.
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Comparing the Income Tax Slab for FY 2022-23 & AY 2023-24 to Previous Years
The income tax slab for FY 2022-23 and AY 2023-24 has undergone some significant changes from the previous year. The tax exemption limit has been increased from ₹2.5 lakhs to ₹5 lakhs. This will benefit taxpayers who have an income of up to ₹5 lakhs. The higher tax slab of 20% has also been revised to apply to income over ₹10 lakhs. This will reduce the burden on taxpayers with higher incomes.
In addition, the surcharge applicable on income above ₹1 crore has also been reduced from 15% to 12%. The cess applicable on income tax has also been increased from 4% to 5%. Also, the standard deduction has been increased from ₹40,000 to ₹50,000. These changes have been made to provide relief to taxpayers and simplify the taxation system.
Calculating Your Income Tax Liability for FY 2022-23 & AY 2023-24
Calculating your income tax liability for FY 2022-23 and AY 2023-24 is a straightforward process. The first step is to calculate your total taxable income. This includes all your income from salary, income from house property, income from other sources and capital gains. Once your total taxable income is calculated, you can use the tax slab to calculate your tax liability.
If your total taxable income is up to ₹5 lakhs, then you are eligible for the tax exemption limit of ₹5 lakhs. If your total taxable income is over ₹5 lakhs, then you will be taxed at the applicable rate. You will also be required to pay the cess and surcharge applicable to your income. Once your tax liability is calculated, you can deduct any applicable tax deductions or tax credits.
Maximising Your Tax Savings for FY 2022-23 & AY 2023-24
Maximising your tax savings for FY 2022-23 and AY 2023-24 is an important part of financial planning. Tax-saving investments such as Public Provident Fund (PPF), National Pension System (NPS), Equity Linked Savings Scheme (ELSS) and life insurance policies are some of the best options for saving tax. These investments also provide long-term capital appreciation and regular income.
You can also avail of tax deductions for certain expenses such as medical insurance premiums, tuition fees, home loan interest payments and donations. You can also avail of tax credits for investments in specific government schemes such as Sukanya Samriddhi Yojana and Pradhan Mantri Vaya Vandana Yojana. These investments can help you reduce your overall tax liability.
Penalties for Late Filing of Income Tax Returns for FY 2022-23 & AY 2023-24
Filing your income tax return on time is very important. If you fail to file your income tax return before the due date, then you may be liable to pay the penalty. The penalty is calculated as a percentage of the tax due and is applicable for each month of delay in filing the return.
The penalty for late filing of the income tax return for FY 2022-23 and AY 2023-24 is as follows: up to ₹5,000 for a delay of up to 1 month; up to ₹10,000 for a delay up to 3 months; up to ₹10,000 for delay up to 6 months; and up to ₹1,000 per day for delay beyond 6 months. In addition, you may also be liable to pay interest on the tax due.
It is, therefore, important to file your income tax return on time to avoid any penalties. If you are unable to file your income tax return on time, then you should contact your Chartered Accountant or filing service provider to get help in filing your return.
Conclusions
In conclusion, the income tax slab for FY 2022-23 and AY 2023-24 has undergone some significant changes from the previous year. The tax exemption limit has been increased from ₹2.5 lakhs to ₹5 lakhs, and the higher tax slab of 20% has been revised to apply to income over ₹10 lakhs. In addition, the surcharge applicable on income above ₹1 crore has been reduced from 15% to 12%, and the cess applicable on income tax has been increased from 4% to 5%. It is important to file your income tax return on time to avoid any penalties and to maximise your tax savings, tax saving investments like PPF and ELSS should be considered.
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