The Income Tax Slab is a level of taxation for a person. According to the new tax regime, income tax slab rates are lower than the previous ones. This new regime also applies to firms and co-operative societies. In addition, senior citizens over 75 years of age do not have to file tax returns. Their bank accounts will deduct TDS automatically.
No differentiation based on age group
Income tax is a system in which the tax rate is varied depending on the taxpayer’s age. In the old taxation system, the age of a taxpayer was considered while determining the tax rate. In the new taxation system, however, the tax rates are based on a person’s income instead of his or her age.
Applicable to firms
Firms are not exempt from paying tax but must pay it to the Government. Generally, firms pay a flat 30% tax rate. However, if their revenue exceeds Rs. 1 crore, they have to pay a 10% surcharge. Partnership firms are not exempt from paying tax and have to register with the Income Tax Department. They also need to get PAN card numbers for their businesses.
There are different income tax slabs for co-operative societies. These different tax slabs apply to different categories of entities, but generally co-operative societies are taxed according to their total income. If the total income of a co-operative society exceeds Rs. 1 crore, a surcharge of 12% will apply. This surcharge can be lowered by applying marginal relief. Under certain circumstances, a cooperative society may opt for taxation under a different tax slab.
The government has proposed reducing the Alternate Minimum Tax (MAT) rate for co-operatives from 18 percent to 15 percent. This will ensure parity in the MAT rate between co-operatives and companies. This move will help enhance the income of co-operatives and the rural community.
Gifts received during festive season taxable as per donee’s slab rate
Income tax rules state that gifts received during the festive season are taxable at the donee’s slab rate. However, some gifts are exempt from tax. These gifts are those from a donee’s spouse, brother, sister, or parents. This also includes gifts transferred under an inheritance or will.
A tax-exempt gift is one which is received from a relative. However, if the gift is given to a friend, it will be treated as income from other sources. The tax-exempt limit for gifts during this period is Rs 50,000.
Gifts received from an employer are also exempt from tax. These gifts can be in the form of cash, cheque, or draft. However, the value of the gift cannot exceed Rs. 5,000. Gifts that exceed this amount will be taxable.