IT Chart 2017

As per the budget FY17-18, there has been a relaxation for individuals’ whose taxable income is below 500000 p.a. There has been a 50% reduction in the tax rates applicable on this slab. This will have a tremendous relief impact on these individuals and the rate of savings as well as personal investments in the form of SIPs may see a rise.

Let us see the illustration of the tax calculation for an Individual whose taxable income is below 500000 p.a. after deduction of Sec 80C.

After Budget Before budget
Current Budget FY 17-18 FY 16-17 if income below 5 Lacs
Below 5 Lacs Below 5 Lacs
Gross total Income 640000 Gross total Income 640000
80C 150000 80C 150000
Total 490000 Total 490000
0-250000 Nil 0-250000 Nil
Balance 240000 5% 12000 Balance 240000 10% 24000
Less Rebat 87A(which was earlier 5000) 2500 Less Rebat 87A(which was earlier 5000) 5000
Total Tax 9500 Total Tax 19000

The same is illustrated below for an individual’s taxable income above 500000 p.a after deduction of Sec 80C.

Current Budget FY 17-18 FY 16-17 if income above 5 Lacs
Above 5 Lacs Above 5 Lacs
Gross total Income 750000 Gross total Income 750000
80C 150000 80C 150000
Total 600000 Total 600000
0-250000 Nil 0-250000 Nil
250000-500000 5% 12500 250000-500000 10% 25000
Balance 100000 20% 20000 Balance 100000 20% 20000
Less Rebat 87A 0 Less Rebat 87A 0
Total Tax 32500 Total Tax 45000