As citizens of the country, every citizen has his own duty. One of these duties is to contribute to the progress of the country. All kinds of development and security works like roads, electricity, airport etc. continue continuously in the country. Money is required from time to time for these works. This money is supplied by the government as tax from merchants and common citizens. One of these taxes is income tax.
What is the income tax limit?
Tax is collected from ordinary citizens for development, social and protective activities according to the amount of their income. According to this amount, recovery is called income tax limit or income tax slab.
Lower income tax limit
But before collecting the income tax, the government takes care that the primary needs of the citizens are met first. Tax should be collected only on the income above it. For this purpose, a lower income limit is fixed before income tax is collected. This means that no income tax can be charged from those who have less than that income. This is called lower income tax limit.
Higher income tax limit
Similarly, a maximum limit is also prescribed for income tax collection, that is, income can be recovered only to a certain extent by income on more than this amount. One idea behind setting the maximum income tax percentage limit is that people with higher incomes should not be discouraged. This is called the income tax cap.
Currently the minimum income limit is Rs 2.5 lakh, that is, no income tax of any kind will have to be paid on annual income below this. Similarly the maximum tax limit is 30%. That is, no matter how much income you make annually, no more than 30% of income tax can be collected from you. A tax slab between these two limits has been set by the government, which changes every year.
Income tax slabs for this year are as follows:
- Rupee. 2.5 to 5 lakhs – 5%
- Rupee. 5 lakh and above Rs. 7.5 Lakhs – 10%
- Rupee. Above 7.5 lakhs and Rs. Upto 10 Lakh – 15%
- Rupee. 10 lakh and above Rs. 12.5 lakhs up to 20%
- Rupee. Above Rs. 12.5 lakh and Rs. Up to 15 lakhs – 25%
- Above ₹ 15 Lakh – 30%
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